The CARES Act, signed into law in March 2020, provided contribution relief to employers by allowing contributions to be delayed until the end of 2020. Initial guidance from the PBGC clarified that payment / filing deadlines would not be extended, rendering delayed contributions useless for 2020 premium purpose (see our summary of prior guidance here).
Updated PBGC guidance released this month adjusts this course, allowing for the following:
- Delayed contributions: Contributions funded on or before January 1, 2021 can be considered “receivable”, allowing their value to be discounted and included in the assets used to determine the variable-rate premium.
- Amended filings: The change regarding delayed contributions necessitated the ability for sponsors to submit amended premium filings. Any additional receivable contributions funded after the initial filing would result in a reduced variable premium amount and possible refund.
The press release can be found on the PBGC website here. Feel free to reach out to your Foster & Foster consultant with any questions you may have.