![\"A](\"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-content\/uploads\/sites\/4\/2019\/08\/PBGC-Final-Regulations-Teminated-and-Insolvent-Multiemployer-Plans.jpg\")
<\/p>\nOn May 1, 2019, The Pension Benefit Guaranty Corporation (PBGC) issued its final regulations on terminated and insolvent multiemployer plans. The changes to its previous regulations pertain to annual valuation requirements, withdrawal liability payments, terminated and insolvent plan notices, and financial assistance applications to the PBGC. These regulations became effective July 1, 2019.<\/p>\n
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Under the new regulations, there have been changes made to the reporting and disclosure requirements for multiemployer plans that are terminated by a mass withdrawal or in critical status, insolvent or projected to become insolvent. For plans terminated by mass withdrawal, the plan sponsor must value the plan’s benefits and assets which are not forfeitable as of the last day of the plan year in which the plan terminates and each year, from that point on. Plans that have non-forfeitable benefits of $25 million or less can apply the annual actuarial valuation for the next two years and are required just to perform a new valuation for the third year. As a result of the new regulations, there now are fewer plans that are required to provide an annual actuarial valuation since the monetary level has been increased from $25 million to $50 million. Plans terminated by a mass withdrawal may use an actuarial valuation for five years if their non-forfeitable benefits do not exceed $50 million. For those plans with non-forfeitable benefits in excess of $50 million, an annual actuarial valuation is required.<\/p>\n
Insolvent plans or those expected to be insolvent are now able to use an actuarial valuation for five years if their non-forfeitable benefits do not exceed $50 million. Of these plans that are receiving financial assistance from the PBGC, they can meet their actuarial valuation compliance requirements by filing alternative information on the PBGC\u2019s website.<\/p>\n
Filing requirements under the final regulations requires that plan sponsors file actuarial valuations with the PBGC within 180 days after the end of the plan year for which the actuarial valuation is performed. Insolvent plans with under $50 million in non-forfeitable benefits that are receiving PBGC financial assistance can elect to comply with the alternative filing option (i.e., via the PBGC website).<\/p>\n
Multiemployer plan sponsors subject to the actuarial valuation requirement must file information with the PBGC regarding withdrawal liability based on the final regulations\u2019 specific information to be filed which is based on whether or not the employer was assessed a withdrawal liability and the type of the withdrawal liability payment (e.g., lump sum or periodic payment). The required information must be filed within 180 days after the end of the plan year in which the plan terminates, and each year thereafter.<\/p>\n
Two notices are now required for plans that have terminated by mass withdrawal or are in critical status. These include: a notice of insolvency noting the plan year that the plan is insolvent or expected to become insolvent and a notice of insolvency benefit level indicating the level of benefits that will be paid during the plan year in which a plan is insolvent. The final regulations also specify the timeframes in which the plan notices must be provided. For instance, notice of insolvency must be provided 90 days before the start of the insolvency year or 30 days after the date of the insolvency determination; whichever comes later. A combined notice (i.e., of insolvency and insolvency benefit level) is permitted for the same insolvency year and most of the annual updates to notices of insolvency benefit levels have been eliminated.<\/p>\n
For PBGC-insured multiemployer plans unable to pay their guaranteed benefits when due, the PBGC will provide financial assistance (i.e., a loan allowing the plan to pay participants their guaranteed benefits and the plan\u2019s \u201creasonable\u201d administrative expenses. Plans in these situations must file their loan applications no later than 90 days before the first day of the month when the determination that the plan will be unable to pay guaranteed benefits when due for that month.<\/p>\n","protected":false},"excerpt":{"rendered":"
Reporting and Disclosure Changes Under the new regulations, there have been changes made to the reporting and disclosure requirements for multiemployer plans that are terminated by a mass withdrawal or in critical status, insolvent or projected to become insolvent. For plans terminated by mass withdrawal, the plan sponsor must value the plan’s benefits and assets… Read more »<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[2],"tags":[],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/posts\/1620"}],"collection":[{"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/comments?post=1620"}],"version-history":[{"count":1,"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/posts\/1620\/revisions"}],"predecessor-version":[{"id":2158,"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/posts\/1620\/revisions\/2158"}],"wp:attachment":[{"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/media?parent=1620"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/categories?post=1620"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.amalgamatedbenefits.com\/amalgamated-employee-benefits-administrators\/wp-json\/wp\/v2\/tags?post=1620"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}