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DOL Issues Final Rules for Annual Funding Notice Requirements and Addresses Extended Pension Smoothing Law’s Impact on Annual Funding Notices


February 2015

The U.S. Department of Labor (DOL) issued final rules for the annual funding notice requirements of section 101(f) of ERISA. Plan administrators of defined benefit pension plans that are subject to the PBGC’s insurance program must furnish funding notices each year. The Pension Protection Act of 2006 (PPA) made changes to the prior annual funding notice requirements, including changes to the content of the notices, the timeframe for providing notices, and expanding the requirement from applying to just multiemployer defined benefit plans to applying to all defined benefit plans. The final rules detail the content and timing requirements of the notices, specify which persons are entitled to receive a notice, describe limited exceptions to the notice requirements, and provide relief in the case of plan mergers. Additionally, two model notices are provided in appendices to the final rules (one for single employer plans and one for multiemployer plans). The due date for large plans to provide notices is the 120th day following the end of the plan year to which the notice relates (for calendar year plans, the due date is April 30th of each year). For small plans, the notice must be provided on or before the due date, with extensions, of the plan’s Form 5500 annual report.

The DOL also issued Field Assistance Bulletin 2015-01, which provides guidance for compliance by single employer defined benefit pension plan administrators with the annual funding notice requirements in light of the changes made by the Highway and Transportation Funding Act of 2014. That law extended the funding relief for defined benefit pension plans that was originally enacted under the 2012 MAP-21 Act. Field Assistance Bulletin 2015-01 revises certain statements made in Field Assistance Bulletin 2013-01, which was discussed in a prior alert, and provides a new model supplement to the annual funding notice.

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