Buck Bond Group

Pension Funding and Certification Relief Announced for Harvey and Irma

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Volume 40 | Issue 109

Download this FYI Alert as a printable PDF

 IRS has announced an extension until January 31, 2018 to make required contributions to single and multiemployer pension plans, to obtain AFTAP certifications to forestall funding-based limits on distributions and plan accruals, and for other similar funding certifications and obligations. The relief applies to select areas affected by the twin hurricanes.


This year’s catastrophic hurricanes have made meeting contribution deadlines and obtaining actuarial certifications required for ERISA defined benefit plans challenging for many plan sponsors. Key deadlines for plans operating on a calendar year are the September 15 minimum funding contribution due date and the October 1 AFTAP (Adjusted Funding Target Attainment Percentage) certification deadline to forestall funding based limitations. IRS, DOL and PBGC had issued guidance on many disaster-related relief provisions (see our September 6, 2017 For Your Information) for those affected by Hurricane Harvey; comparable relief has just been released for Hurricane Irma in News Releases IR-2017-150 and IR-2017-151.

Funding-Based Relief

In Notice 2017-49, IRS, DOL and PBGC provide an extension from the relevant Initial Relief Date (see below) until January 31, 2018 for the following.

For single employer plans:

  • Annual and quarterly contributions due
  • Date for making prefunding and funding standard carryover balance elections
  • AFTAP certifications
  • Participant notices of funding-based restrictions
  • CSEC (Cooperative and Small Employer Charity) plan annual funding restoration certifications
  • CSEC adoption of funding restoration plans
  • Timeliness of contribution to be credited to prior year for ERISA Title IV purposes, such as PBGC premium calculations and ERISA 4010 determinations
  • Date for submitting funding waiver requests

For multiemployer plans:

  • Endangered and critical status certifications (but does not extend the 240 days for reacting with a funding improvement or rehabilitation plan based on the extended relief date)
  • Endangered and critical status improvement or rehabilitation plan adoption (for dates based on earlier certifications that fall in the relief period)

The relief described above is available to affected plans in affected areas.

Affected Plans

The relief applies to a plan if any of the following were located in an affected area:

  • Office of plan or plan administrator
  • Office of primary recordkeeper
  • Office of the enrolled actuary or other advisor previously retained to make certifications or funding determinations
  • Plan sponsor’s principal place of business (if plan covers just one employer, ignoring controlled group rules)
  • Principal place of business of employers (ignoring controlled group rules) of more than 50% of plan’s active participants

For this purpose, “office” means the worksite of the relevant individuals and the location of records needed for determining funding requirements.

Affected Area and Initial Relief Date

The affected area is defined as any of the Texas counties identified for individual assistance by FEMA because of Hurricane Harvey, any of the Florida counties identified for individual assistance by FEMA because of Hurricane Irma, and any other areas identified for individual assistance by FEMA because of Hurricane Harvey, Hurricane Irma, Tropical Storm Harvey, or Tropical Storm Irma. The area is considered affected from the date specified by FEMA as the beginning of the incident period (“initial relief date”).

Comment. Unlike the guidance released about loans and withdrawals from qualified plans for counties in Texas affected by Hurricane Harvey, this notice specifically allows relief for the associated tropical storms and for affected areas outside the primary state affected by the disasters. However, unless FEMA adds a location, the expanded language has no impact. For example, as of this writing, there were no counties identified by FEMA in the declaration for Louisiana Tropical Storm Harvey. And read carefully – FEMA posted two declarations for Florida Hurricane Irma, but only one is for the major disaster declaration that lists affected counties.

For updates on the areas covered and details on Irma-related relief, check the IRS newsroom.

In Closing

Plan sponsors affected by these two major storms will welcome having one less urgent demand on their resources – both time and cash flow – as they strive to recover from the blow dealt by Mother Nature.