Number: 10-04

May 11, 2004

New Revised Form LM-2, Form T-1, and QuickBooks PowerPoint Presentations Posted to OLMS Web Site — Plus Additional Revised Form LM-2 and Form T-1 Frequently Asked Questions

The Department of Labor’s Office of Labor-Management Standards (OLMS) has posted three new PowerPoint presentations and new Revised Form LM-2 and Form T-1 Frequently Asked Questions to the OLMS Web site.

Two of the PowerPoint presentations cover the use of the new electronic Form LM-2 and Form T-1 software. Topics covered include: entering information directly into an online version of the forms, importing files extracted from your financial accounting system, applying digital signatures to the forms and electronically filing the forms with OLMS.

The third PowerPoint presentation covers bookkeeping for the Form LM-2 with the QuickBooks accounting software. Topics covered include: options to create various chart of accounts and entering check, credit card, salary, and reimbursed transactions.

Below are the new questions that we have posted to our Web site since our last update on April 6, 2004 (OLMS News 09-04). Should you have any follow-up questions please feel free to submit them via e-mail to OLMS at:

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Revised Form LM-2 - Frequently Asked Questions

Questions on Schedules 11 – 13

Q. Should delegates to conventions be reported in Schedule 11 or 12?

A. A delegate should be reported in Schedule 11 only if the individual holds an officer position in the reporting union. An individual who is a delegate from the reporting union but is not an officer of that union would be considered an employee and should be reported in Schedule 12.

Q. A union and an employer have agreed that the employer will initially pay union officers' and members' lost time when they take off from work to perform union business. The payment to the employee is made by the employer. At the end of the month, the union reimburses the employer for all the lost time payments. Should these payments be reported in Schedules 11/12?

A. Yes, these payments should be reported in Schedules 11 and 12 with an explanation of the arrangement with the employer in Item 69, Additional Information.

Q. A district lodge collects only per capita payments from its subordinate locals. Must the district lodge report membership figures in Schedule 13?

A. Yes, all reporting unions should complete Schedule 13 by listing the categories of membership it tracks, and by entering the number of members for each of these categories.

Q. If a union establishes an "alumni association" of former members who pay dues to the alumni association, but not the union, and are not considered to be union members and have no rights as members, must these individuals be reported in Schedule 13?

A. No, this would not be considered a membership category.

Questions on Schedules 1 – 10

Q. In a district council consisting of many subordinate locals, checkoff checks from employers are made payable to the local but are deposited to the district council's checking account. Assuming there are accounts receivable to be reported on Schedule 1, who reports the accounts receivable?

A. The receipts would be reported by the district council in Item 46, On Behalf of Affiliates for Transmittal to Them, and the district council's remittance to the locals would be reported in Item 63, To Affiliates of Funds Collected on Their Behalf. Any accounts receivable would represent money owed to the locals and should be reported by the locals.

Computer and Software Requirements

Q. What if an entity uses cents as well as dollars? Will the software round this?

A. You cannot import numbers with cents because the import feature was not designed to round. However, the software does round numbers that you enter manually.

Q. Will the software truncate text that is too long for a field?

A. No, the text must be no longer than the number of characters allowed in the field (usually 50).

Questions on Schedules 14 – 19

Q. If a union uses Expedia to book its travel on line, do the same requirements relating to identifying the vendor on credit card charges still apply?

A. Yes, regardless of whether travel is booked through a travel agency or an on-line travel service, the union's disbursements should be allocated to the vendors who provided the services (airline, hotel, etc.). However, if the union has purchased a pre-set package from a travel agency or on-line service where the consumer does not know how much of the cost was for individual components of the package, the travel agency or on-line service can be listed as the vendor.

Q. A union has a targeting fund by which the local makes payments to union contractors in order to make them competitive with non-union contractors. These amounts would total or exceed $5,000 in a reporting year. The union does not want to name these union contractors in Schedule 15 because this would become an enormous advantage to a nonunion contractor when bidding on jobs. This situation is not one of the examples in the LM-2 instructions for which confidentiality can be claimed. Can confidentiality be cited for the situation described by this union?

A. A disbursement must be reported in the normal manner if it is not encompassed within one of the five types of information listed in the instructions for Form LM-2 for which special procedures for reporting confidential information can be used. Disbursement of job targeting funds that exceed the itemization threshold should thus be disclosed.

Q. Should the time of employees who perform payroll functions for the union be allocated to Schedule 18, General Overhead, or Schedule 19, Union Administration?

A. Schedule 18, General Overhead.

New Form T-1 - Frequently Asked Questions

Questions on Contributions to a Trust

Q. A union pays the salary for a credit union's employees but the credit union reimburses the union for those payments. Assuming the credit union meets the definition of a trust in all other ways, are the union's payments for salary considered part of the union's contribution to the trust for the reporting year?

A. No, this would be a loan by the union to the credit union, rather than a contribution. Loans made are reportable in Item 61, and on Schedule 2 of Form LM-2. Repayments of loans made are reported in Item 45, and Schedule 2.


Last Updated: 5-12-04