PBGC Offers Premium Penalty Relief

February 16, 2012 (PLANSPONSOR.com) – The Pension Benefit Guaranty Corporation (PBGC) announced a limited window for covered plans that have never paid required premiums to pay past-due premiums without penalty.

As part of PBGC’s review of its premium regulations pursuant to Executive Order 13563, calling for agencies to develop a plan to review existing regulations to identify any that can be made more effective or less burdensome, the agency is adopting a voluntary compliance program to encourage compliance and reduce workload burden in connection with covered plans that have never paid required premiums. PBGC will waive premium payment penalties (as well as information penalties under the Employee Retirement Income Security Act (ERISA) section 4071 for failure to timely file premium information) for any such plan if the plan administrator contacts PBGC, pays past due premiums and files required information within the time frames described in the agency’s announcement.  

PBGC said the relief does not apply to late payment interest charges.  

To qualify for the relief, the plan administrator of an eligible plan (or a representative) must: 

1. By July 31, 2012, contact Robert Callahan (callahan.robert@pbgc.gov) or Bill O’Neill (oneill.bill@pbgc.gov) of PBGC’s Financial Operations Department (202–346–4067) to discuss how to comply with premium filing requirements to obtain this relief, and 

2. By August 31, 2012 (or a later date specified by PBGC), pay past-due premiums and file required premium information.