Compliance June 1, 2006

PBGC Says Mandatory E-filing Begins July 1

June 1, 2006 (PLANSPONSOR.com) - The Pension Benefit Guaranty Corporation (PBGC) will soon require sponsors of insured defined benefit pension plans to electronically submit their premium filings to the agency.
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The PBGC’s new rule is in Thursday’s Federal Register and will go into effect on July 1 for sponsors of large plans with at least 500 participants. All other plan sponsors must electronically submit their plans beginning on Jan. 1, 2007.

The complete rule in the Federal Register can be found  here . 

The PBGC, which insures private sector pension plans, originally offered its online application, My Plan Administration Account, as a voluntary practice for plan years beginning in 2004, according to the rule (See PBGC Accepting My PAA Premium Filings ).

Users can enter information in online data screens and create electronic premium filings. My PAA processes Form 1-ES, Form 1-EZ, Form 1 and Form 1 with Schedule A premium filings. E-filers can pay with Automated Clearing House, electronic check or credit card and select a payment date online, or plan sponsors may also pay through methods such as paper check or wire transfer, according to the rule.

The organization introduced a second filing method in 2005 for pension practitioners who use private sector software, according to the rule. The third option that the PBGC made available this year is a combination of the first two methods, which allows e-filers to import draft filings into the My PAA data entry and editing screens that they prepared with private-sector software, according to the rule.

The PBGC will enact this new rule to continue executing the Government Paperwork Elimination Act, which is meant to remove impediments that paperwork causes in electronic transactions, according to the rule.

“The PBGC has been procession premium filings for 30 years,” according to the rule in the Federal Register. “The volume of filings processed annually is in the tens of thousands. Processing methods have become progressively more automated … the capture of data from paper premium forms and the translation of the data into electronic data files is an imperfect process that inevitably gives rise to errors that can be difficult and burdensome to detect and correct.”

For the PBGC’s PAA premium filing Web site, go here.

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