### Question
How does the law define small employer?


### Answer
Under *29 U.S.C. § 1401*, **small employer** is defined as:

> any employer which, for the calendar year in which the transaction referred to in paragraph (1)(B) occurred and for each of the 3 preceding years, on average—


(i) employs not more than 500 employees, and


(ii) is required to make contributions to the plan for not more than 250 employees

#### Citation:
  - *29 U.S.C. § 1401*
  - Heading: **CHAPTER 18-EMPLOYEE RETIREMENT INCOME SECURITY PROGRAM > SUBCHAPTER III-PLAN TERMINATION INSURANCE > Subtitle E-Special Provisions for Multiemployer Plans > part 1-employer withdrawals**

