Reportable Events; Funding-Related Determinations for Threshold Test, Waivers, and Extensions; Effect of the Pension Protection Act of 2006; Guidance for 2009 Plan Years:  On January 9, 2009, PBGC issued Technical Update 09-1 , which provides guidance on the applicability of changes made by the Pension Protection Act of 2006 as they relate to PBGC's Reportable Events regulation (29 CFR part 4043).  Technical Update 09-1 provides basically that for Reportable Events purposes, a plan's unfunded vested benefits and the value of its assets and vested benefits are determined for a plan year beginning in 2009 in the same manner as for premiums for the preceding plan year.  See Technical Update 07-2 for Reportable Events guidance for 2008 plan years. (01/09/09)

Minimum Lump Sum Assumptions for Terminating Single-Employer Plans; Pension Protection Act of 2006:  On December 31, 2008, PBGC issued Technical Update 08-4 , which provides guidance on minimum lump sum assumptions for plans that terminate in standard terminations (and in certain distress terminations) after the effective date of PPA 2006 changes to interest and mortality assumptions for minimum lump sums in ongoing plans.  Among other things, Technical Update 08-4 addresses situations where a plan terminates in a plan year before the PPA 2006 interest rate basis is fully phased in and pays lump sums in a subsequent plan year.  See Technical Update 07-3  for guidance on minimum lump sum assumptions for plans that terminate before the effective date of the PPA 2006 changes. (12/31/08)

Multiemployer Withdrawal Liability Final Rule:  On December 30, 2008, PBGC published in the Federal Register a final rule that implements changes under the Pension Protection Act of 2006 (PPA 2006) to the withdrawal liability methods for multiemployer plans and makes other changes to the multiemployer program under PBGC's regulatory authority.  For example, the rule implements the PPA 2006 "fresh start" option for determining withdrawal liability.  (12/30/08)

Benefit Restrictions - Present Value of PBGC Maximum Guarantee:  The Pension Protection Act of 2006 provides that, generally beginning in 2008, single-employer plans that are between 60 and 80 percent funded may not pay lump sums or other accelerated distribution forms with values in excess of: (1) 50 percent of the amount that would be paid absent the restriction or, if smaller (2) the present value of PBGC's maximum guarantee computed under PBGC guidance. Technical Update 07-04 describes the methodology used to determine the present value of PBGC’s maximum guarantee and explains that a table will be posted for each calendar year.  On December 22, 2009 PBGC posted the 2009 table. (12/22/08)

ERISA Section 4010 Filing Waiver:  On December 19, 2008, PBGC issued Technical Update 08-3, which waives the filing under ERISA section 4010 for information years beginning on or after January 1, 2008 if:  (1)  the sole reason reporting would otherwise be required is because one or more plans sponsored by members of the filer's controlled group have a funding target attainment percentage of less than 80 percent;  and (2)  the aggregate underfunding for plans sponsored by members of the filer's controlled group is less than $15 million.  This waiver is identical to a waiver in PBGC's proposed rule that would amend PBGC's regulation on Annual Financial and Actuarial Information Reporting (29 CFR part 4010).  PBGC expects to issue a final rule in early 2009.  PBGC issued Technical Update 08-3 pending issuance of the final rule so that potential filers can make informed decisions about elections to waive carryover balances, which, for many plans, are due by year-end.  (12/19/08)

2009 Premium Filings: The premium payment instructions for plan years beginning in 2009 (including illustrative forms) for both Estimated Flat-rate Filings and Comprehensive Filings have been posted to the Premium Instructions and Forms page of our Web site. "What's New" will be updated when My Plan Administration Account (My PAA), PBGC's premium e-filing application, is ready to accept 2009 filings (expected by the end of January 2009). (12/12/08)

Expected Retirement Age Update: On December 1, 2008, PBGC published a final rule amending its valuation regulation by substituting a new table for selecting a retirement rate category.  The new table applies to any plan being terminated either in a distress termination or involuntarily by the PBGC with valuation date falling in 2009. (12/01/08)

2009 Maximum Guarantee: On December 1, 2008, PBGC published a final rule amending its benefits payment regulation by updating the maximum guaranteeable monthly benefit table for 2009.  The maximum guaranteeable monthly benefit for 2009 is $4,500.00 (as compared with $4,312.50 for 2008). (12/01/08)

Flat-Rate Premium Increase for Plan Year 2009: On December 1, 2008, PBGC published a notice stating that the per-participant flat-rate premium for single-employer plans for plan year 2009 is $34.00 (up from $33.00 for Plan Year 2008) and $9.00 (unchanged from Plan Year 2008) for multiemployer plans. By law, the premium rates are adjusted for inflation each year based on changes in the national average wage index. (12/01/08)

Disclosure of Termination Information Final Rule: On November 18, 2008, PBGC published a final rule to implement section 506 of the Pension Protection Act of 2006, which amends sections 4041 and 4042 of ERISA. These amendments require that plan administrators, plan sponsors, and PBGC disclose certain information in connection with distress terminations or PBGC-initiated terminations to affected parties upon request. (11/18/08)

 What’s New for Practitioners Archive