What is the minimum amount for the Fidelity Bond if the calculated 10% would result in an amount below $1,000?

The minimum amount for the Fidelity Bond in this context is indeed $1,000. Under the Employee Retirement Income Security Act (ERISA), every plan must maintain a fidelity bond to protect the plan from losses due to fraud or dishonesty of plan officials and employees who handle plan funds. The law specifies that the bond amount should be at least 10% of the funds handled, but if this calculation results in an amount below $1,000, the minimum required bond is set at $1,000.

This ensures that there is a baseline level of protection for the participants in the retirement plan, regardless of the scale or total assets in the plan. If the calculated amount of 10% is lower than $1,000, the regulation mandates that the bond must still meet or exceed this minimum figure, thus securing adequate insurance against potential losses.