Congress passes pension funding relief and increases PBGC premiums

HRS Insight

Congress has passed the Moving Ahead for Progress in the 21st Century Act ("MAP-21"), funding highway transportation projects and extending student loan interest rates.  Significant changes for employer-sponsored defined benefit pension plans are included in the legislation as revenue raisers, including provisions providing for:

  • Stabilization of interest rates used by plan actuaries to calculate minimum contributions as well as to determine the applicability of certain benefit restrictions for underfunded plans;
  • Increases in PBGC premiums; and
  • An extension of the ability to transfer surplus pension assets to pay for retiree medical benefits as well as a new opportunity to make similar transfers to purchase retiree life insurance.

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