PBGC announces availability of 2015 premium filing instructions and My PAA for 2015 premium filings

The Pension Benefit Guaranty Corporation (PBGC) has announced the availability of the 2015 premium filing instructions and My PAA for the 2015 premium filings. The PBGC states that the filing requirements for 2015 are almost identical to the 2014 filing requirements. However, the PBGC notes a number of changes in the 2015 instructions.

In 2014, the PBGC issued final regulations that simplified the premium payment rules by, among other things, streamlining the due dates. In the 2015 instructions, the PBGC explains that the previously provided due date transition rule for small plans in now fully phased-in. Therefore, small plans are now subject to the same dues dates as other plans. In general, the 2015 due date for calendar year plans is October 15, 2015.

Plans may now provide an alternative phone number instead of the plan administrator’s phone number on the PBGC’s Is my Pension Insured web page. In addition, information about the number of former employees involved in certain recent risk transfer activities (i.e., annuity purchases and lump-sum windows) must be reported in 2015. Because the reporting requirement for 2015 applies to a much longer period than for subsequent years, reasonable estimates may be reported instead of exact counts. The instructions include a new definition for “Lump Sum Window” in Appendix 1.

Premium rate changes

The PBGC notes that changes in the flat-rate premium, the variable-rate premium, and the cap on variable-rate premiums are reflected in the instructions. The changes in the flat-rate premium include the increase of the multiemployer flat-rate premium from The Multiemployer Pension Reform Act of 2014.

Changes in certification procedures for uploaded filings

Changes in the certification procedures for uploaded filings are included in the list of what’s new for 2015. In prior years, the person responsible for uploading was permitted to upload filings before the plan administrator had manually signed a hard copy of the premium data generated by the private-sector software. Starting with 2015 filings, to ensure the filing has, in fact, been certified by the plan administrator, the uploader must wait until the manual certification has been done. If the enrolled actuary for the plan is also certifying manually, the same rule applies with respect to the actuarial certification. After the filing is uploaded, the My PAA generated confirmation number must be written on the certified paper copy and retained in plan records. Finally, the detailed information about certifying uploaded premium filings in the My PAA Users Manual has been modified accordingly.

Small plan lookback rule

The variable-rate premiums for most small plans are now based on the prior year’s unfunded vested benefits (UVBs) (using the lookback rule) instead of the current year’s UVBs. However, in the 2014 instructions, the PBGC explained that small plans could opt out of the lookback rule for 2014 and subsequent years. For 2015, PBGC approval is required to start using the lookback rule in 2015 after opting out in 2014, and, with limited exceptions, to opt out of the lookback rule starting with 2015. The instructions have been expanded to clarify the exceptions and provide information on how to request approval.

Source: PBGC website, March 9, 2015.

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