7/09/2021
Notice 2021-38: Issues Relating to Special Financial Assistance from the Pension Benefit
Guaranty Corporation to Certain Multiemployer Defined Benefit Pension Plans
Provides guidance to sponsors of multiemployer defined benefit pension plans that are required to reinstate certain previously suspended benefits as a condition of receiving special financial assistance from the Pension Benefit Guaranty Corporation under the American Rescue Plan Act of 2021; whether make-up payments with respect to previously suspended benefits are eligible to be rolled over to another eligible retirement plan, and the extent to which any special financial assistance received by the plan is not taken into account in determining contributions.
The notice addresses three important areas:
The reinstatement of previously suspended pension benefits, along with make-up payments, as a condition that eligible multiemployer plans must meet if they receive special financial assistance.
The individual income tax treatment of these make-up payments.
How a plan that receives special financial assistance must treat the plan’s special financial assistance account for purposes of the minimum funding requirements for multiemployer defined benefit plans
Resources:
PBGC guidance on the application process for special financial assistance can be found at www.PBGC.gov/arp-sfa