The Washington Report

June 12, 2024

Note to Subscribers

While we do our best to provide timely updates, it is possible that the information shared in the newsletter may change after our publication deadline.

Retirement

 

PBGC Issues Final Rule on Valuation Assumptions and Methods
On June 6, 2024, the Pension Benefit Guaranty Corporation (PBGC) issued a final rule amending its regulation on Allocation of Assets in Single Employer Plans to modernize the interest, mortality, and expense assumptions used to determine the present value of benefits for a single employer pension plan ending in a distress or involuntary termination. The assumptions are also used for certain multiemployer withdrawal liability calculations, 4010 reporting, and other purposes. There are no notable changes from the proposed rule issued August 18, 2023. Key assumption changes include moving to a generational approach for mortality and a yield curve approach for interest. On the same day, the PBGC also released a white paper providing additional information on the methodology that will be used to determine the interest assumption. The final rule is effective July 8, 2024. The revised assumptions apply to calculations where the valuation date is on or after July 31, 2024.

The final rule is available here.

The white paper is available here.