PBGC Publishes Model Participant Notice

March 20, 2001 (PLANSPONSOR.com) - Employers with underfunded plans - or those not sure if they qualify - can check out a new worksheet from the Pension Benefit Guaranty Corporation (PBGC).

According to the PBGC, the Retirement Protection Act of 1994 requires certain underfunded plans to notify participants and beneficiaries annually of the plan’s funding status and the limits of PBGC’s guarantee.  That regulation includes a model notice that plans can use to meet this requirement.

Variable Requirement
Generally, the plan administrator of any single-employer plan that pays a variable rate premium for the 2001 plan year must issue a 2001 Participant Notice. However, no notice is required if the plan meets certain funding requirements for the 2000 or 2001 plan year, as explained in the worksheet.

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The 2001 Participant Notice is due two months after the due date (including extensions) for the 2000 Form 5500.  For calendar year plans, the 5500 filing date would be July 31, 2001 – meaning the participant notice would be due October 1, 2001.

The Technical Update (at http://www.pbgc.gov/legal_info/tech_updates/tech01-2.htm ) republishes the Model Participant Notice, updated to reflect the 2001 maximum guaranteed benefits.