Resource Tag: Legislation

Civil Service Survivor Annuities Protected
The Restoring Pension Promises to Workers Act of 2007 would ensure that surviving spouses of former federal employees under the Civil Service Retirement System (CSRS) would receive their survivor benefits regardless of when the worker left employment. Under current law widows and widowers of federal employees under CSRS receive survivor annuities if the employee dies while still […]

Protections When Companies Sell Divisions
The Restoring Pension Promises to Workers Act of 2007 would protect certain early retirement pensions when companies sell divisions and employees continue working for the new owner. Current law protects the portion of a subsidized early retirement benefit that an employee has earned at the time a company changes or terminates its plan if the […]

Limitations on Recovery of Overpayments
The Restoring Pension Promises to Workers Act of 2007 would impose limitations on a pension plan’s ability to collect money from pension recipients for overpayments. Under current law, if a pension plan discovers that it made a mistake in a retiree’s pension benefit, the plan can recover the amount of the overpayment regardless of whether […]

Executive Tax Breaks Linked to Worker Plans
Under the Restoring Pension Promises to Workers Act of 2007, retirement plans that only benefit top paid executives will lose their special tax treatment if the company does not offer a defined benefit pension plan to its non-executive workforce. Current law allows companies to have separate retirement plans just for top paid executives with no requirement that […]

Interest Rates For Lump Sums
The Pension Protection Act of 2006 changes the interest rates used to calculate lump sum distributions, also known as cashouts. Many traditional defined benefit plans permit retirees to choose to take a single lump sum payment rather than a lifetime monthly annuity. If a lump sum is selected, the interest rate used to calculate the amount of […]

Pension Funding Notices
The Pension Protection Act of 2006 requires both single and multiemployer defined benefit pension plans to provide annual plan funding notices. These funding notices inform pension plan participants about the financial status of their pension plans. Under prior law, all private retirement plans were required to provide overviews of their financial status to employees in […]

Increase in Maximum Bond Amount
The Pension Protection Act of 2006 increases the bond requirement for people handling private retirement plan money. All individuals with control over retirement plan assets and other plan fiduciaries must be bonded. The bond, which must represent at least 10 percent of a plan’s assets, is used to protect the plan from fraud committed against the plan by […]

Increased Penalties for Coercive Interference with Pension Rights
The Pension Protection Act of 2006 increases penalties for coercive interference with pension rights. The private pension law makes it unlawful for anyone to use fraud, force, violence or threat of violence to restrain, coerce, or intimidate a retirement plan participant or beneficiary for the purpose of interfering with or preventing the exercise of any right under the […]

Transfer of Excess Pension Assets to Multiemployer Health Plans
The Pension Protection Act of 2006 will allow multiemployer plans to transfer excess assets into the plan paying for current retiree health care. Generally employers may not withdraw assets from a plan and such a transfer would constitute a prohibited transaction imposing strict penalties on the plan sponsor. The current law provides an exception to […]

Transfer of Pension Assets to Health Plans: Single Employer Plans
The Pension Protection Act of 2006 will allow single employer plans to transfer more of their “excess” assets to pay for their retiree health insurance costs. Employers maintaining single employer defined benefit plans have been permitted to transfer excess plan assets to pay for future retiree health benefits when the plan is overfunded by more than […]

Access to Multiemployer Plan Information
The Pension Protection Act of 2006 requires multiemployer plans to furnish participants and beneficiaries with certain financial information upon written request. All private retirement plan participants can request copies of their plans’ annual financial reports. Plan administrators must file the annual financial report called a Form 5500 seven months after the end of a plan […]

Faster Vesting for Profit Sharing Plans
The Pension Protection Act of 2006 will shorten the length of time required to vest in the contributions that employers make to profit sharing and certain other defined contribution plans. Currently, employees can forfeit all employer contributions to most private retirement plans if they work for an employer (or employers) contributing to the plan for fewer than […]