Premium late payment charges (PBGC.gov)

If you file a premium payment after the Filing Due Date, we will bill the plan for the appropriate late payment charges. The charges include both interest and penalty charges. The charges are based on the outstanding premium amount due on the Filing Due Date. PBGC also may assess penalties under section 4071 of ERISA for failure to provide premium-related information.

The penalty is a percentage of the unpaid premium amount for each month (or portion of a month) it remains unpaid. The monthly rate is higher or lower depending on whether the premium underpayment is “self-corrected.”
The penalty rate is 1 percent of the late premium payment per month if the late payment is made on or before the date when the PBGC issues a written notification indicating that there is or may be a premium delinquency (e.g., a statement of account (premium invoice), a past-due-filing notice, or a letter initiating an audit). A penalty rate of 5 percent per month applies to payments made after the PBGC notification date.
The Late Payment Penalty Charge is subject to a minimum of $25 and a maximum of 100 percent of the unpaid premium amount.

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Late Payment Interest Charges will be assessed for any premium amount not paid when due, whether because of an estimated participant count or an erroneous participant count or other mistake in computing the premium owed.

The Late Payment Interest Charge is set by ERISA and we cannot waive it. Interest accrues at the rate imposed under section 6601(a) of the Internal Revenue Code (the rate for late payment of taxes) and is compounded daily. The rate is established periodically (currently on a quarterly basis) and the PBGC publishes the interest rates on or about the 15th of January, April, July, and October in the Federal Register.

For plans required to pay premiums for 500 or more participants for the prior plan year, the total flat-rate premium, in the case of a single-employer plan, or the entire premium, in the case of a multiemployer plan, is due by the First Filing Due Date.

If the full amount due is not paid by that date, the plan will be subject to late payment interest charges and may also be subject to late payment penalty charges. See “Minimizing Late Payment Charges” below for further information.

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How to start the process for requesting a penalty waiver? The process typically begins after the receipt of a Statement of Account (SOA). If you believe that the Statement of Account resulted from an error,
- call our premium payer customer service representatives at 1-800-736-2444 (or at 202-326-4242 if you are in the local Washington, DC area),
- email us at premiums@pbgc.gov to resolve the error or,
- TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to 1-800-736-2444.
To request a waiver: If calling or emailing our customer service representatives does not resolve the matter to your satisfaction, you may request a waiver of the penalty charge by documenting the reasons for requesting a waiver of penalty and then e-mailing us at premiums@pbgc.gov or sending a written request (within 30 days after the date of the SOA) to:
Pension Benefit Guaranty Corporation

Dept. 77840

P.O. Box 77000

Detroit, MI 48277-0840

PBGC will consider the facts and circumstances and send the plan administrator a written response, generally within 90 days after the request.

To request reconsideration: If the penalty waiver request is denied, you may request reconsideration of PBGC's initial determination to deny the request for waiver of the penalty (unless we ordered the initial determination to be final) by e-mailing us at premiums@pbgc.gov, or sending a written request (within 30 days after the date of the initial determination) to:

Pension Benefit Guaranty Corporation

Dept. 77840

P.O. Box 77000

Detroit, MI 48277-0840

PBGC will consider the request for reconsideration independently and will respond to you in writing. This response will be the agency's final determination on the matter.
Failure to obtain premium forms and instructions from the PBGC is not reasonable cause for a waiver.
PBGC has no authority to waive premium and interest charges.
Before the Filing Due Date, if you can show substantial hardship and that you will be able to pay the premium within 60 days after the Filing Due Date, you may request that we waive the Late Payment Penalty Charge. If we grant your request, we will waive the Late Payment Penalty Charge for up to 60 days.

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Final Filing: If you are having difficulty determining your plan’s premium before the Final Filing Due Date, you can file your premium forms using an estimate. You can then make an amended filing, reflecting the actual figure. This will minimize the assessment of Late Payment Charges to the plan.

Estimated Filing: The premium owed for a plan year is based on the number of plan participants as of the premium snapshot date. However, plans may not have an accurate participant count before the First Filing Due Date. For this reason, the Form 1-ES permits plans to compute the amount owed on the basis of an estimated participant count. However, we remind you that for plans required to pay premiums for 500 or more participants for the prior plan year, the total flat-rate premium, in the case of a single-employer plan, or the entire premium, in the case of a multiemployer plan, is due by the First Filing Due Date.

If the full amount due is not paid by that date, the plan will be subject to late payment interest charges and may also be subject to late payment penalty charges.
No penalty will be charged (although interest will be charged) if you did not make an estimated premium payment because you erroneously reported fewer than 500 participants for the plan year preceding the premium payment year. In addition, you can avoid a late payment penalty charge (but not the interest) for the flat-rate premium if the premium (based on an estimated participant count) that you pay with the Form 1-ES by the First Filing Due Date equals at least the lesser of:
- 90 percent of the premium amount due on the plan’s Final Filing Due Date for the flat-rate single-employer or multiemployer premium, or
- an amount equal to the participant count for the year before the premium payment year multiplied by the plan’s flat-rate for the premium payment year. This test will be met if the amount paid is sufficient using either the actual participant count for the plan year preceding the premium payment year or a smaller count that was erroneously reported.
  
  For purposes of determining whether a penalty is due, the participant count “erroneously reported” refers to the premium filing (or last amended filing) for the plan year preceding the premium payment year made to the PBGC by the First Filing Due Date. See the Form 1-ES instructions for more detail.
  
  If you have an accurate participant count by the First Filing Due Date, you should pay the amount owed by that date. If you do so, you will avoid the interest charge and any penalty charge. If you have all the information needed to make a final filing on or before the First Filing Due Date, you may file a Form 1-EZ or Form 1 (with Schedule A for a single-employer plan). If you file a Form 1-ES, you will still be required to file a Form 1-EZ or Form 1 (with Schedule A for a single-employer plan) by the Final Filing Due Date.

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Statements of Account (SOA) are issued for premium, penalty, and interest amounts owed to PBGC as a result of late payment or underpayment of premiums.

To ensure that the amount due does not increase, the premium and interest must be paid within 30 days of the SOA's issue date.
If the SOA appears to be in error, contact our premium payer customer service representatives at 1-800-736-2444 (or at 202-326-4242 if you are in the local Washington, DC area), or email premiums@pbgc.gov. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to the appropriate number in the preceding sentence.
In some cases, it may be necessary to submit an amended filing to clear up the problem that caused the erroneous SOA to be issued.

Past Due Filing Notices are issued when PBGC's records indicate that a plan's premium filing form is missing for a particular plan year.

If the Past Due Filing Notice appears to be in error (e.g., the premium filing was made or the EIN/PN is incorrect), contact our premium payer customer service representatives at 1-800-736-2444 (or at 202-326-4242 if you are in the local Washington, DC area), or email premiums@pbgc.gov. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to the appropriate number in the preceding sentence.
It may be necessary to submit an amended filing to correct the error.
For issues involving a plan's termination, you may be referred to PBGC's customer service representatives for plan termination issues, who are also at the same telephone numbers (1-800-736-2444, or 202-326-4242 if you are in the local Washington, DC area), or email standard@pbgc.gov. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to the appropriate number in the preceding sentence.

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