What Are PBGC Filings?

The Pension Benefit Guaranty Corporation (PBGC) plays a crucial role in protecting the retirement incomes of over 33 million American workers in private-sector defined benefit pension plans. To fulfill this mission, the PBGC requires certain filings from employers who sponsor these plans. PBGC filings are essentially a series of reports, forms, and notifications that keep the PBGC informed about the financial health of pension plans, ensuring that it can take timely action if needed. These filings serve as a safeguard, enabling the PBGC to intervene when a plan is underfunded, at risk of termination, or undergoing significant corporate changes.

One of the most common PBGC filings is the PBGC Form 1, which is an annual submission required from most pension plan sponsors. This form provides detailed information about the plan’s financial status, including the funding level and any past-due contributions. The purpose of this filing is to give the PBGC an overview of the plan’s health and any potential risks that could impact participants’ benefits. Another key filing is the Comprehensive Premium Filing, which involves the payment of premiums to the PBGC, based on the number of participants in the plan and the plan's funding status. These premiums help fund the PBGC’s operations and its ability to insure pension benefits.

In addition to these routine filings, the PBGC also requires special notifications in certain circumstances. For example, if a company experiences a significant corporate event, such as a merger or acquisition, or if the pension plan faces a significant funding shortfall, the plan sponsor must notify the PBGC through specific forms, such as PBGC Form 10 (for reportable events) or PBGC Form 200 (for missed contributions). These filings allow the PBGC to assess any increased risk to the pension plan and take proactive steps to protect the beneficiaries.

Failure to comply with PBGC filing requirements can result in significant penalties for plan sponsors, including fines and potential legal action. Moreover, late or inaccurate filings can delay the PBGC’s ability to step in and protect workers’ pensions, which could lead to financial losses for both the plan sponsor and participants.

In summary, PBGC filings are critical to maintaining the integrity and security of defined benefit pension plans. By keeping the PBGC informed through regular and special filings, plan sponsors not only comply with legal requirements but also contribute to the broader goal of ensuring that workers receive the retirement benefits they have earned.

References:

[1] Pension Benefit Guaranty Corporation. (n.d.). Annual Financial and Actuarial Information (PBGC Form 1). Retrieved from https://www.pbgc.gov/sites/default/files/4010_60-day.pdf 

[2] Pension Benefit Guaranty Corporation. (n.d.). Comprehensive Premium Filing Instructions. Retrieved from https://www.pbgc.gov/sites/default/files/documents/2022-premium-payment-instructions.pdf 

[3] Pension Benefit Guaranty Corporation. (n.d.). Reportable Events and Large Unpaid Contributions (PBGC Form 10 and PBGC Form 200). Retrieved from https://www.pbgc.gov/prac/reporting-and-disclosure/reportable-events 

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