Employee Retirement Income Security Act: Pension plan termination insurance program; penalty relief and deadline extension in response to terrorist attacks,
[Federal Register: October 11, 2001 (Volume 66, Number 197)]
[Rules and Regulations]
[Page 51864-51867]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr11oc01-12]
PENSION BENEFIT GUARANTY CORPORATION
29 CFR Chapter XL
Disaster Relief Relating to PBGC Deadlines in Response to Terrorist Attacks of September 11, 2001
AGENCY: Pension Benefit Guaranty Corporation.
ACTION: Notice of disaster relief relating to PBGC deadlines.
SUMMARY: The Pension Benefit Guaranty Corporation is extending deadlines and providing relief from penalties in response to the major disasters declared by the President of the United States on account of the terrorist attacks of September 11, 2001.
FOR FURTHER INFORMATION CONTACT: Harold J. Ashner, Assistant General Counsel, Office of the General Counsel, Suite 340, Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, DC 20005, 202- 326-4024. (For TTY and TDD, call 800-877-8339 and request connection to 202-326-4024.)
SUPPLEMENTARY INFORMATION:
Introduction
The Pension Benefit Guaranty Corporation administers the pension plan termination insurance program under Title IV of the Employee
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Retirement Income Security Act of 1974 (ERISA). ERISA and PBGC regulations set deadlines of various kinds that must be met in order to be in compliance with the law.
The PBGC is aware that many of its customers may face a variety of compliance-related problems and concerns as a result of the terrorist attacks of September 11, 2001. During this difficult period, the PBGC will work with its customers to resolve any special issues and problems that may arise. This notice provides relief relating to PBGC deadlines.
Persons Entitled to Relief
This notice provides relief relating to PBGC deadlines as described below to Designated Persons. A ``Designated Person'' is a person responsible for meeting a PBGC deadline (for example, a plan administrator or plan sponsor) that (1) is located in a disaster area for which relief is provided under the Department of Labor announcement referenced below, or (2) cannot reasonably obtain information or other assistance needed to meet the deadline from a service provider, bank, or other person whose operations are directly affected by the disaster.
This notice also provides relief relating to PBGC deadlines as described below where a plan's Form 5500 or Form 5500-EZ filing deadline is extended as a result of the terrorist attacks under the announcement issued by the Department of Labor on September 14, 2001, on behalf of the Pension and Welfare Benefits Administration, the Internal Revenue Service, and the PBGC (a ``Form 5500 Disaster Extension''). The Department of Labor announcement is available at http://www.dol.gov/dol/pwba/public/media/press/Pr091401.htm. A Form 5500 deadline that was extended as a result of that DOL announcement is referred to in this notice as a ``Form 5500 Disaster Extension Date.''
Claiming Disaster Relief
A person claiming disaster relief described in this notice for a filing made with the PBGC should print or type ``September 11, 2001, terrorist attack relief until ______'' prominently at the top of the filing, inserting in the blank the last date to which relief for the filing is provided. (On Form 1 or Form 1-EZ, also check the ``disaster relief'' box at the top of the form.) Similarly, if a person receives an inquiry or bill from the PBGC that appears not to take disaster relief into account, the inquiry or bill should be returned to the PBGC with the same wording written at the top. (The PBGC may, for example, generate such an inquiry or bill because it has not yet been alerted to the fact that the filer claims disaster relief.)
Case-by-Case Relief
This notice does not cover every situation in which PBGC disaster relief may be warranted. For example:
The definition of ``Designated Person'' does not capture every person that might experience difficulty in meeting a PBGC deadline for reasons related to the disaster.
This notice does not grant specific disaster relief for all filings. For example, it does not provide relief for certain filings that involve particularly important or time-sensitive information where there may be a high risk of substantial harm to participants or the PBGC insurance program, i.e., notices of large missed contributions under section 412(n) of the Internal Revenue Code, advance notices of reportable events under ERISA section 4043, and annual financial and actuarial information reports from certain controlled groups under ERISA section 4010.
Those affected by the disaster who need relief from the PBGC that is not covered by this notice should contact the PBGC as soon as reasonably possible. The PBGC will work with them in ensuring that they receive appropriate relief. To request case-by-case relief, contact Diane Morstein at the PBGC by ______.
Calling 1-800-736-2444, extension 4136, or 202-326-4136 (for TTY and TDD, call 800-877-8339 and request connection to 202-326- 4136);
Sending an e-mail to practitioner.pro@pbgc.gov; or
Writing to Pension Benefit Guaranty Corporation, Diane Morstein, Suite 610, 1200 K Street, NW., Washington, DC 20005-4026, Re: Disaster Relief Notice.
Premiums
Relief for Designated Persons
The following relief applies where the plan administrator of a plan is a Designated Person.
First, if the deadline for submitting a premium payment form and paying any related premium (making a ``premium filing'') for the plan falls on or after September 11, 2001, and before February 12, 2002, the PBGC will waive any late payment penalty (under ERISA section 4007) and any late filing penalty (under ERISA section 4071) for the period from that premium filing deadline through February 12, 2002.
Second, if the plan has a Form 5500 Disaster Extension Date for the 2000 plan year that is later than February 12, 2002, the PBGC will waive any late payment penalty and any late filing penalty for the period from February 12, 2002, through that Form 5500 Disaster Extension Date for the following premium filings:
The plan's 2001 Form 1 (or Form 1-EZ) premium filing that is due late in the 2001 plan year (e.g., October 15, 2001, for calendar year plans), and
The plan's 2002 flat-rate premium filing (the ``Form 1-ES filing'') that is due early in the 2002 plan year (e.g., February 28, 2002, for calendar year plans) if the plan is a large plan. (Also, the PBGC will treat the 2002 Form 1-ES filing as timely made for purposes of applying the ``safe harbor'' penalty waiver rules if the filing is made by the 2000 Form 5500 Disaster Extension Date.)
Relief for Persons Other Than Designated Persons
Where the plan administrator of a plan is not a Designated Person, the PBGC will provide penalty relief if (1) the plan has a Form 5500 Disaster Extension Date of November 15, 2001, for the 1999 or 2000 plan year because of disruption of transportation and delivery of documents, and (2) the premium filing deadline for the plan for the following plan year (the 2000 or 2001 plan year, respectively) falls on or after September 11, 2001, and before November 15, 2001. Under this penalty relief, the PBGC will waive any late payment penalty (under ERISA section 4007) and any late filing penalty (under ERISA section 4071) for the period from that premium filing deadline through the November 15, 2001, Form 5500 Disaster Extension Date.
Effect on Interest
The relief in this notice relating to PBGC premiums does not include relief from late premium payment interest charges. The PBGC is not permitted by law to waive such charges. (ERISA section 4007(b); 29 CFR 4007.7 and .8(b)(3)).
Effect of Short Plan Years
This premium-related relief assumes no short plan years, but applies in similar fashion to short plan years. Plan administrators of plans with short plan years during the relevant period should contact the PBGC for guidance.
Examples
Example 1. Plan A is a calendar year plan. The deadline for Plan A's 2001 Form 1 (or Form 1-EZ), along with the related premium payment, is October 15, 2001. Plan A's original 2000 Form 5500 due date of July 31, 2001, was extended for two and a half months to October 15, 2001, for reasons
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unrelated to the disaster. Plan A's plan administrator is a Designated Person. Under this notice, the PBGC will waive late payment penalties and late filing penalties for the period from October 15, 2001, through February 12, 2002. Because Plan A's Form 5500 Disaster Extension Date for the 2000 Form 5500 is also February 12, 2002, this notice does not provide additional penalty relief beyond February 12, 2002.
Example 2. Plan B's plan year begins on March 1. The deadline for Plan B's 2001 Form 1 (or Form 1-EZ), along with the related premium payment, is December 17, 2001. Under Plan B's Form 5500 Disaster Extension, the 2000 Form 5500 (which was originally due October 1, 2001) is due July 30, 2002. Plan B's plan administrator is a Designated Person. Under this notice, the PBGC will waive late payment penalties and late filing penalties for Plan B's 2001 Form 1 (or Form 1-EZ) filing for the period from December 17, 2001, through July 30, 2002.
Example 3. Plan B in Example 2 is a large plan required to pay its 2002 flat-rate premium filing (Form 1-ES filing) on April 30, 2002. Under this notice, the PBGC will waive late payment penalties and late filing penalties for the period from April 30, 2002, through July 30, 2002, for Plan B's 2002 Form 1-ES filing.
Example 4. Plan C is a calendar year plan. The deadline for Plan C's 2001 Form 1 (or Form 1-EZ) is October 15, 2001. Plan C's original 2000 Form 5500 due date of July 31, 2001, was extended for two and a half months to October 15, 2001, for reasons unrelated to the disaster. Plan C has a Form 5500 Disaster Extension because the plan administrator had difficulty in meeting filing deadlines because of disruption of transportation and delivery of documents by mail or private delivery service resulting from the disasters. Plan C's Form 5500 Disaster Extension Date for the 2000 Form 5500 is November 15, 2001. Plan C's plan administrator is not a Designated Person. Under this notice, the PBGC will waive late payment penalties and late filing penalties for Plan C's 2001 Form 1 (or Form 1-EZ) for the period from October 15, 2001, through November 15, 2001.
Single-Employer Plan Terminations
Standard Terminations
If the plan administrator of a plan that is terminating in a standard termination is a Designated Person, any of the following plan termination deadlines for the plan that falls on or after September 11, 2001, and before February 12, 2002, is extended to February 12, 2002:
The deadline for filing the standard termination notice (Form 500) (29 CFR 4041.25(a)). (Note that this automatically extends the deadline for providing notices of plan benefits to participants and beneficiaries (29 CFR 4041.24(a)) because that deadline is the date when the standard termination notice is filed.)
The deadline for completing the distribution of plan assets (29 CFR 4041.28(a)).
The deadline for filing the post-distribution certification (Form 501) without penalty (29 CFR 4041.29(b)). (Note that this automatically extends the deadline for filing missing participant information and certifications without penalty and for paying missing participants' designated benefits to the PBGC without interest (29 CFR 4050.6(b)(2)).)
Distress Terminations
If the plan administrator of a plan that is terminating in a distress termination is a Designated Person and the deadline for filing the distress termination notice (Form 601) (29 CFR 4041.45(a)) falls on or after September 11, 2001, and before February 12, 2002, that deadline is extended to February 12, 2002. (Plan administrators of plans in distress terminations for which the PBGC has issued a distribution notice should contact the PBGC for case-by-case relief. See ``Case-by-case relief'' above.)
Participant Notices
A plan's deadline for providing a Participant Notice under ERISA section 4011 for a plan year is two months after the deadline (including extensions) for filing the plan's Form 5500 for the preceding plan year (29 CFR 4011.8). Thus, if the plan has a Form 5500 Disaster Extension for the 2000 plan year, the deadline for providing a Participant Notice for the 2001 plan year is automatically extended to two months after the 2000 Form 5500 Disaster Extension Date.
In addition, if the plan administrator of a plan is a Designated Person, any deadline for providing a Participant Notice that falls on or after September 11, 2001, and before February 12, 2002, is extended to February 12, 2002.
Reportable Events Notices
Under the PBGC's regulation on post-event notices of reportable events (29 CFR part 4043, subparts A and B), the plan administrator and each contributing sponsor of a plan for which a reportable event occurs generally must notify the PBGC of the event within 30 days after the event occurs. In certain cases, the regulation extends the reporting deadline until 30 days after a plan's Form 5500 due date. (See 29 CFR 4043.23(d)(2), .29(d)(2), .30(d)(2), .31(d)(2), and .34(d)(4).) If such a 30-day extension applies to a Form 5500 for which there is a Form 5500 disaster extension, the 30-day extension period in the PBGC's regulation will begin to run on the Form 5500 Disaster Extension Date.
In addition, if a Designated Person is responsible for filing a reportable event post-event notice for which the deadline falls on or after September 11, 2001, and before February 12, 2002, that person's deadline for filing the notice is extended to February 12, 2002.
In the case of notices required in advance of the effective date of a reportable event (29 CFR part 4043, subparts A and C), the PBGC will grant relief where appropriate on a case-by-case basis. See ``Case-by- case relief'' above.
Annual Employer Reporting Under ERISA Section 4010
The PBGC's regulation on Annual Financial and Actuarial Information Reporting (29 CFR part 4010) requires annual financial and actuarial information reporting in certain cases by contributing sponsors (and their controlled group members) maintaining plans with large underfunding or certain missed contributions or funding waivers. The PBGC will grant relief where appropriate on a case-by-case basis for these reports. See ``Case-by-case relief'' above.
However, the regulation permits the filing of certain actuarial information by an alternative due date, which is 15 days after a plan's Form 5500 due date, if certain requirements are met (29 CFR 4010.10(b)). If such an alternative due date is based on a Form 5500 for which there is a Form 5500 Disaster Extension, the 15-day period in the PBGC's regulation will be measured from the Form 5500 Disaster Extension Date.
Requests For Reconsideration or Appeals
The deadline for requesting review of a PBGC determination under the PBGC's regulation on Rules for Administrative Review of Agency Decisions (29 CFR part 4003) is generally 45 days (for an appeal) or 30 days (for a request for reconsideration) after the date of the determination. If a Designated Person is aggrieved by a PBGC determination, and the deadline for filing an appeal or a request for reconsideration of the determination falls on or after September 11, 2001, and before February 12, 2002, that person's deadline for filing the appeal or request for reconsideration is extended to February 12, 2002.
Multiemployer Plan Deadlines
Premium Deadlines
The disaster relief relating to premium deadlines (discussed under ``Premiums,'' above) also applies to multiemployer plans.
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Other Multiemployer Deadlines
Under the PBGC's regulations governing multiemployer plans, various persons (e.g., the plan sponsor) are subject to deadlines for making filings with the PBGC, issuing notices to persons other than the PBGC, and taking other actions. If the person responsible for meeting the deadline is a Designated Person, and the deadline falls on or after September 11, 2001, and before February 12, 2002, the PBGC will neither assess a penalty under ERISA section 4302 nor take any other enforcement action with respect to any failure to comply with the deadline during the period ending on February 12, 2002.
The PBGC recognizes that persons other than the PBGC may have rights to enforce some of these deadlines. The PBGC expects these persons to act reasonably--fully taking into account the effects of the recent disasters--in deciding whether and to what extent to exercise these rights.
The PBGC will grant other relief where appropriate on a case-by- case basis for deadlines relating to multiemployer plans. See ``Case- by-case relief'' above.
Issued in Washington, DC, this 5th day of October 2001. John Seal, Acting Executive Director, Pension Benefit Guaranty Corporation.
[FR Doc. 01-25638Filed10-10-01; 8:45 am]
BILLING CODE 7708-01-P
