Highlights of 2024 PBGC Meeting With ABA’s Joint Committee on Employee Benefits

by Harold Ashner and Israel Goldowitz

On April 30, 2025, the American Bar Association (“ABA”) posted a summary of the May 1, 2024, meeting between representatives of the Pension Benefit Guaranty Corporation (“PBGC”) and representatives of the ABA’s Joint Committee on Employee Benefits (“JCEB”).  Two Wagner Law Group partners (Israel Goldowitz, former PBGC Chief Counsel, and Harold Ashner, former PBGC Assistant General Counsel for Legislation and Regulations), in collaboration with Katie Kohn (a partner with Thompson Hine), coordinated the meeting with PBGC for the JCEB representatives.

As discussed in the summary, which is available at www.americanbar.org/content/dam/aba/events/employee_benefits/technicalsessions/2024/2024-pbgc-jceb-meeting.pdf, there were several key points discussed at the meeting, including the following:

• Reportable Events Experience.  PBGC staff reported that it received fewer reportable event notices in Fiscal Year 2023 (ending Sept. 30, 2023) than in any prior year, with a year-over-year decrease both in terms of numbers of filings and percentage of plans filing, and with the decrease across all event types. On the other hand, staff noted that the number of late filings – about one third of all filings – has remained consistent. Common issues with filings include late filings, non-filing, and failing to include the proper attachments.

• Standard Termination Audit Experience.  PBGC staff addressed common errors detected in standard termination audits, including errors in calculating lump sums; determining compensation; incorrectly rolling over missing participants’ benefits to an IRA instead of using the PBGC Missing Participants Program; premature distributions; pro rata payment of benefits based on plan assets; and failure to obtain spousal consent for distributions. PBGC noted that audits generally take 18 months on average, though the length of the audit depends on the size and complexity of the plan, as well as the capacity of PBGC’s audit team.  PBGC continues to audit every plan with over 1,050 participants and has seen an increase in the number of large plans doing standard terminations.  For plans with no more than 1,050 participants, PBGC audits a sample, as well as any plan for which PBGC is aware of a potential problem.

• Missing Participants Experience.  PBGC staff indicated that PBGC continues to receive Missing Participants Program filings at a steady pace.  Approximately three quarters of the filings are made in connection with a standard termination, with the remaining quarter from defined contribution plans.  Staff noted that some defined contribution plans have a Roth benefit feature, and PBGC expects an increase in these Roth features.  PBGC continues to see filing errors, and has updated the Missing Participants Program forms, spreadsheets, and instructions.  Common filing errors include not splitting out pre-tax benefits from Roth funds, and withholding taxes from the benefit transferred to PBGC.  PBGC offers pre-filing consultations to reduce errors.

• Special Financial Assistance. PBGC staff reported that PBGC has approved SFA payments to 72 plans in the amount of approximately $53.9 billion, and that there are currently 20 applications under review with requests totaling $14.3 billion.  Staff further reported that there are currently 87 plans on the waiting list to apply for SFA.  The waiting list is updated every Friday and can be viewed at www.pbgc.gov/arp-sfa.  PBGC is taking more time to get to the plans on the waiting list in part because of changes to the procedures requiring more expansive death audits.  PBGC has more advanced search tools than the general public, such as the Social Security Death Master File, which is why plans were missing a number of deceased participants in the plans’ own death audits.  PBGC staff suggested, however, that plans on the waiting list complete a death audit before submitting an SFA application.

• Premiums. PBGC staff reminded practitioners of the early premium due date in 2025 of September 15, which was put in place in 2015.  The budget has called for repeal of this provision, but Congress has not yet acted.  Employers should consider how the early premium due date in 2025 will impact, or make difficult, decisions regarding funding.  PBGC is concerned that smaller plans without knowledgeable vendors may miss the deadline, and there is sensitivity at the agency to ignoring the earlier deadline by not assessing penalties and interest if the plan pays by the usual October 15th deadline.

There were several other issues discussed at the meeting, as detailed in the summary on the ABA’s website.  If you are facing PBGC-related issues, you should feel free to contact The Wagner Law Group for assistance.

Harold J. Ashner advises and represents clients on a wide variety of employee benefits matters, with an emphasis on PBGC issues. He served as Assistant General Counsel for Legislation and Regulations at PBGC, where he drafted or supervised virtually all regulations and policies issued by PBGC from 1988 until he left the agency in 2005.

Israel Goldowitz has over 40 years of experience. He was the Chief Counsel for the Pension Benefit Guaranty Corporation (PBGC). He led the legal teams that helped save the pensions of such companies as Chrysler and American Airlines.