(March 11, 2013) -- If you run a single-employer corporate defined benefit pension (DB) plan in the US, this means you.
The Employee Benefits Security Administration (EBSA) has issued a new set of calculations and statements that must be provided to all members in their annual funding notices.
The additional disclosure, or "temporary supplement," informs members of the impact of MAP-21 (the Moving Ahead for Progress in the 21st Century Act) on their pension plan's liabilities.
EBSA provides the chart below as a model: plans publishing this chart with the correct figures, along with the stipulated explanations, will be in compliance with the new rules, according to the administration. A guidance bulletin released on Friday states that plans do not have to use the model supplement (an appendix to the bulletin). "However," the memo states, "pending further guidance, use of an appropriately completed MAP-21 Supplement, together with the model annual funding notice, will, as a matter of department enforcement policy, satisfy the content requirements."
EBSA estimates that this additional disclosure requirement applies to approximately 12,000 single-employer DB plans across the country. Should all of these plans comply with the rule, roughly 33.5 million people will receive additional funding notices, costing plan sponsors in aggregate an estimated $7 million annually ($6 million to prepare and $1.04 million in postage).
Read the full guidance bulletin with the model MAP-21 disclosure supplement here.
