A technical update on the deadlines for premium payments for pension plans with plan years beginning in 2025 and later was issued by the Pension Benefit Guaranty Corporation (PBGC).
The announcement highlighted that premiums for plan years starting in 2025 must be paid one month ahead of schedule in accordance with the Bipartisan Budget Act of 2015 (BBA 2015), as opposed to the PBGC's payment of premiums regulation.
According to Section 502 of the BBA 2015, the deadline for filing premiums for plan years starting in 2025 and later is the 15th day of the ninth calendar month following the start of the plan year. For example, the premium due date for a plan year beginning on January 1, 2025, will now be September 15, 2025, instead of October 15, 2025, as it was under the previous rule.
For 2025 plan years, the BBA 2015 clause overrides the regular and special premium due date regulations. However, it does not override the PBGC's disaster assistance guidelines or the filing rules for deadlines that coincide with weekends or federal holidays.
The revised deadlines for plan years starting in 2025 can all be found on the PBGC website. The premium filing deadlines specified in the current payment of premiums regulation should be ignored by plan administrators. The PBGC states that the 2025 comprehensive premium filing instructions, which are anticipated to be posted shortly, will include the modified premium due dates.
For eight consecutive years, presidential budget proposals have advocated repealing Section 502 of the BBA 2015. The aim is to spare plan sponsors the costs and administrative burdens associated with accelerated premium payments.
The PBGC noted that the fiscal year 2025 budget referred to this removal as "urgent," highlighting the need for Congressional action to repeal the provision prior to fiscal year 2025. During the fiscal year, the repeal is still possible even though it hasn't happened yet. The PBGC will amend premium filing instructions and alert practitioners "as quickly as possible" if the provision is removed.
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