This is a compliance checklist after—not instead of—the eligibility analysis. §412 applies to plan officials in the statutory setting, so first confirm a Title I plan, Part 4 applicability, plan property, handling by a natural person, and no applicable exemption. 29 U.S.C. §1112 29 C.F.R. §2580.412-6
For the plan-status and property analysis that comes first, use the retirement-plan guide or the welfare-plan guide.
1. Identify the people whose functions create the requirement
A fiduciary is not bonded solely because of the title, and a service provider is not bonded solely because it is a provider. Each is tested on whether a natural person handles funds or other property. Final authority over benefit payments or investments can be handling; recommendations subject to another person's final approval may not be. Controls inform this functional analysis; they are not an independent exemption. DOL FAB 2008-04, Q5–Q9 and Q18–Q21
The functional handling guide provides a role-by-role method for documenting this natural-person analysis.
2. Set the amount for each nonexempt handler
At the beginning of each plan fiscal year, §412 uses at least 10% of the funds handled in the preceding reporting year by the person, group, or class and its predecessor, with a $1,000 floor. The ordinary statutory cap is $500,000; for a plan that holds employer securities or a pooled employer plan, the ordinary cap is $1,000,000. These are not automatic purchase amounts. The statute also permits the Secretary, after notice and an opportunity for hearing, to prescribe a higher amount subject to the 10% limitation. 29 U.S.C. §1112
3. Confirm the bond's required protection and form
The plan is the protected party: the bond must protect it from loss through fraud or dishonesty by persons required to be bonded, directly or through connivance. A deductible or comparable term that transfers risk to the plan is prohibited. DOL FAB 2008-04, Q1 and Q26–Q30 29 C.F.R. §2580.412-11
Individual, name-schedule, position-schedule, blanket, and combined forms can be used if they meet §412 and the regulations. An existing employer crime bond or a provider's arrangement is not compliant merely because of its product name: it must adequately name/protect the plan and satisfy the required terms. DOL FAB 2008-04, Q22 and Q25
If one arrangement is intended to protect more than one plan or group of people, use the multiple-plans guide to check each plan's available recovery.
4. Check the surety at the transaction date
Section 412 calls for a corporate surety acceptable on federal bonds under Treasury authority. DOL's rules address Treasury-approved sureties and restrictions where the plan or a party in interest has control or a significant financial interest in the surety, reinsurer, agent, or broker. Verify the live Treasury material rather than relying on a historical list. 29 U.S.C. §1112 U.S. Department of the Treasury
5. Review reporting with the current instructions
Form 5500 materials address fidelity-bond reporting, but a filing response is not proof that the eligibility, handler, amount, form, or surety analysis is correct. Consult the instructions for the filing year; do not rely on a fixed line reference because the form can change. U.S. Department of Labor, Part VI, line 9d
Keep the handler analysis, amount calculation, bond terms, and surety check with plan records. Revisit them when authority, vendors, property flows, plans covered, or bond terms change. If facts suggest Title I or Part 4 does not apply, or a person/institution exemption may apply, use the exemptions guide before treating the requirement as inapplicable.
When employee withholdings or deposits are part of the property flow, consult the participant contributions guide before completing the handler review.