Roundup of Annual Funding Notice Requirements for Defined Benefit Plans: Single-Employer, Multiemployer and SFA Plans
To enhance retirement security and increase transparency, Defined benefit plans covered by the Pension Benefit Guaranty Corporation (“PBGC”) are required to timely furnish an annual funding notice (“AFN”) to participants, beneficiaries, the PBGC and certain other persons for the purposes of enhancing retirement security and increasing transparency by ensuring that workers receive timely and accurate information regarding the funded status of their pension plans. The AFN must disclose certain information regarding the plan’s funded status, as set forth in Section 101(f) of ERISA, including, among other things, the plan’s funded percentage, assets and liabilities, funding and investment policies, and participant and beneficiary demographics. Recent legislative and regulatory developments, including the American Rescue Plan Act of 2021 (“ARPA”) and the SECURE 2.0 Act of 2022 (“SECURE 2.0”), have significantly updated the AFN requirements, particularly for plans receiving Special Financial Assistance (“SFA”) under ARPA. This article outlines the key changes made to