Frequently Asked Terms

This article explains frequently asked terms related to subscription agreements. Since the impact of these terms may vary based on individual circumstances, investors are encouraged to consult with an advisor or CPAs to ensure they understand the potential implications for their unique situation.

Benefit plan investor – benefit plan investors typically include:

• ERISA Plans – Employer-sponsored retirement plans, such as 401(k) or pension plans, which are subject to ERISA regulations.

• Individual Retirement Accounts (IRAs) – Though not subject to ERISA, IRAs often fall under the definition of a benefit plan investor due to their nature as retirement assets.

Employee Retirement Income Security Act (ERISA) – ERISA is a U.S. federal law enacted in 1974 to set minimum standards for private-sector employee benefit plans, including retirement plans, such as 401(k)s and pension plans.

Custodian – a financial institution responsible for safeguarding an investor’s assets. Custodians help manage the following account types:

• Retirement Accounts (e.g., IRAs, 401(k)s) – Required to have custodial oversight.
• Brokerage Accounts – Most brokerage firms partner with custodians to hold client assets securely.

To determine if your account has a custodian, please review the account opening documents or reach out to the financial institution or investment platform managing your account.

Disregarded entity – A disregarded entity is a tax term that refers to an entity that will be disregarded for federal income tax purposes. A common example is a single-member limited liability company. Unless the single member elects otherwise, the IRS disregards the LLC as an entity separate from its owner, and the owner reports the LLC’s income and deductions on the owner’s federal income tax return. Contact your tax advisor if you are unsure about this selection.

Freedom of information act (FOIA) – FOIA primarily applies to U.S. federal government agencies and certain entities that are considered part of the government. If you are part of the executive branch, a federal agency, or another organization that is subject to public transparency laws, you are likely subject to FOIA. Additionally, if you work for an organization that receives significant federal funding or performs specific government functions, it might also fall under FOIA. Records produced on behalf of a government entity, or maintains records that are used in public policy may be subject to FOIA requests. If you are unsure whether your organization is subject to FOIA, consult with legal counsel or a compliance officer. They can help determine whether your agency or entity is required to comply with FOIA, and how to handle information requests accordingly.