More retirement-related regulatory news for plan sponsors, including links to detailed information.
PBGC announces section 4062(e) – new law is enacted
On December 16, President Obama signed into law H.R. 83, which made major changes to the provision of ERISA that created liability in certain situations where there was a reduction in active participants in a plan as a result of a cessation of operations (section 4062(e)).
With the new law in effect the Pension Benefit Guaranty Corporation (PBGC) will not continue the six-month moratorium on the enforcement of section 4062(e) that expired December 31.
The new law generally applies both to future cessations of operations and to those that have already occurred, except where a settlement agreement was entered into before June 1, 2014. The PBGC has outlined some of the major changes in the law and provided a point of contact for questions here. Further guidance will be issued in the future.
PBGC seeks OMB approval of modifications to Form 10, 10-Advance and Form 200
The PBGC has issued Forms 10 and 10-Advance (10-A) and related instructions under subparts B and C. The PBGC has also issued Form 200 and related instructions under subpart D. The Office of Management and Budget’s (OMB) approval of both of these collections of information expires March 31, 2015. The PBGC intends to request that OMB extend its approval for three years with modifications.
IRS issues relief for certain participants in Section 414(d) governmental plans
The Internal Revenue Service (IRS) has issued Notice 2015-07. The notice announces that the IRS and Treasury Department anticipate issuing proposed regulations that would permit a state or local retirement system that is a governmental plan (within the meaning of section 414(d)) to cover public charter school employees if certain requirements are satisfied. The notice also announces that broader transition relief will be addressed in the proposed regulations. The notice includes a request for public comments.
To read Notice 2015-07, click here.
IRS posts 2014 reference list of changes in qualification requirements for retirement plans
The IRS has published the 2014 reference list which contains items that first appeared on the 2014 cumulative list of changes in plan qualification requirements.
• Determination letter applications – For an individually designed plan submitted on Form 5300, complete the five reference lists for the five years of your remedial amendment cycle (RAC). These are the years covered by the cumulative list applicable to your submission. For an employer adopting a volume submitter plan and submitting on Form 5307, complete the six reference lists for the six years in your RAC.
• Interim amendments – Complete each year’s reference list to check whether your plan document is up-to-date. If you missed any relevant amendments, your plan may have a qualification failure and you must correct the error.
To download the reference list, click here.