As part of PBGC’s review of its premium regulations pursuant to Executive Order 13563, calling for agencies to develop a plan to review existing regulations to identify any that can be made more effective or less burdensome, the agency is adopting a voluntary compliance program to encourage compliance and reduce workload burden in connection with covered plans that have never paid required premiums. PBGC will waive premium payment penalties (as well as information penalties under the Employee Retirement Income Security Act (ERISA) section 4071 for failure to timely file premium information) for any such plan if the plan administrator contacts PBGC, pays past due premiums and files required information within the time frames described in the agency’s announcement.
PBGC said the relief does not apply to late payment interest charges.
To qualify for the relief, the plan administrator of an eligible plan (or a representative) must:
1. By July 31, 2012, contact Robert Callahan (email@example.com) or Bill O’Neill (firstname.lastname@example.org) of PBGC’s Financial Operations Department (202–346–4067) to discuss how to comply with premium filing requirements to obtain this relief, and
2. By August 31, 2012 (or a later date specified by PBGC), pay past-due premiums and file required premium information.
PBGC said, after the end of the period for taking advantage of this relief, it will step up its efforts to enforce premium requirements for covered plans that have not paid any required premiums, including assessment of penalties.
The agency explained that a few times a year, it becomes aware of a covered plan that has never filed PBGC premiums, in some cases because the plan administrator was unaware that the plan was covered. PBGC’s regulation on Payment of Premiums (29 CFR part 4007) requires that in addition to the unpaid premiums, such a plan must pay interest and penalties.
PBGC also said it believes one reason plan administrators of covered plans that have not paid any required premiums fail to come forward is that penalties can be quite substantial, often as much as 100% of the unpaid premium.
The PBGC’s announcement of the relief was in the February 9 Federal Register, and is available at http://www.pbgc.gov/Documents/2012-3054.pdf.
« Senate and House Agree on Payroll Tax Cut for 2012