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Individual Benefit Statements

The Pension Protection Act of 2006 requires plans to provide periodic benefit statements to individuals entitled to benefits from private retirement plans.

Previously, the law generally required pension and profit-sharing plans to give information to people about their benefits if they requested this information in writing.

Under the PPA, traditional pension plans are required to automatically provide individualized benefit statements to employees working under the plan every three years, unless they notify employees once a year that the statements are available. For retirement savings plans, such as 401(k) plans, where employees have control over their investment choices, statements must be provided once every quarter. Other individual account plans, such as profit-sharing plans, employee stock ownership plans, and those 401(k) plans where employees do not have control over their investments, have to provide benefit statements once a year. Workers and their widows and divorced spouses may also make written requests for benefit statements once a year.

Benefit statements must disclose the total benefits earned, the vested accrued benefit or earliest date the benefit will become vested, and an explanation if Social Security or other payments will be subtracted when the benefits are calculated. The law on individual benefit statements took effect in 2007.

Section 508 of the Pension Protection Act of 2006 Public Law 109-280