On March 8, 2013, the U. S. Department of Labor Employee Benefits Security Administration issued Field Assistance Bulletin No. 2013-01 (the “FAB”). The FAB provides a model supplement to the annual funding notice required by the Moving Ahead for Progress in the 21st Century Act (“MAP-21”). The supplemental information contained in the FAB must be included in the 2012 annual funding notices, which for calendar year plans, are due April 30, 2013 (120 days after the end of the close of the 2012 plan year).
ERISA Section 101(f) sets forth the requirement for plan administrators of defined benefit plans to furnish annual funding notices to plan participants. MAP-21 amended ERISA section 101(f)(2) to require plan administrators of certain single-employer defined benefit plans to disclose additional information in the annual funding notice. The additional information relates to the effect the new ERISA Section 303(h)(2)(C)(iv) segment rate stabilization rules have on the plan sponsor’s minimum required contributions to the plan.
This additional information must be provided for plan years beginning after December 31, 2011, and before January 1, 2015, if, for the applicable plan year:
- The plan’s funding target is less than 95% of the funding target determined without regard to the MAP-21 segment rates;
- The plan’s funding shortfall determined without regard to the MAP-21 segment rates is greater than $500,000; and
- The plan had 50 or more participants on any day during the preceding plan year.
Additionally, the MAP-21 supplemental disclosures are not required for any eligible cooperatives and eligible charities for which the effective date of the funding rules under the Pension Protection Act of 2006 were delayed or for any PBGC settlement plans.