Did you recently receive an Annual Funding Notice? Wondering what it means?
Annual Funding Notices keep you (pension plan participants) informed about the financial status of your pension plan.
Now, you're probably wondering why you received the letter. The answer is simple. You received the letter because employers are required to send an Annual Funding Notice each year to everyone covered by their pension plan.
The notice provides you with information about:
- How well your pension plan is funded
- The value of your pension plan's assets and liabilities
- How your pension plan's assets are invested
- The legal limits on how much PBGC can pay if your pension plan ends
The bottom line is there is no need to panic. The notice does not mean that your pension plan is ending or that PBGC is taking over payment of your benefit. While PBGC insures your pension, the pension plan remains under the sponsorship of your employer. PBGC does not have any specific information about your benefit.
For questions about your funding notice, pension plan, or individual benefit, please contact your pension plan administrator, not PBGC. PBGC only has information about pension plans that have ended. You can find contact information for the pension plan administrator in the annual funding notice or through the employer sponsoring the plan, typically via the human resources office.
Additional information is available on our Annual Funding Notice for Defined Benefit Pension Plans page.
Every March we celebrate the profound impact women continue to have on American and world history. While Women's History Month is usually the designated time of year to robustly commemorate the contributions women have made to society, we also think it's a good time to take a look at the state of women's retirement security. After all, life after retirement is very important to "women's history."
First, let's be clear, the retirement picture is dismal for both men and women. But compared to men, women's retirement security is often less than adequate.
The United States Department of Labor reports married women tend to outlive their spouses by two years once they reach age 65 — that's two whole years of additional savings needed to cover the cost of living expenses that some do not factor in. Women also tend to take a more conservative approach when it comes to saving for retirement. Simply put, women do not invest in high-risk stocks because of the volatility of the stock market.
Another factor contributing to the bleak retirement outlook is women often delay saving for retirement. The Department of Labor also reports only 45 percent of the 62 million salaried women working in the United States contribute to a retirement plan.
The United States maintained its retirement security ranking at 19th — the same from last year — among 150 nations analyzed by Natixis Global Retirement Index.
For overall retirement security, the U.S. remains behind the majority of countries in Western Europe and Canada, and ahead only of Israel on the list of the top 20 nations.
Natixis measures the quality of life for people in their retirement years based on 20 measures of health, wealth, quality of life, and material well-being that affect people's retirement security.
Read the full Natixis report: 2014 Global Retirement Index.
By now, you have probably received your Form 1099-R from us.
As you arrange to have your income taxes prepared and filed, we would like to share some important information about PBGC benefits and taxes.
While PBGC is required to withhold federal income tax, we do not withhold for state taxes. If your state has an income tax, you may owe tax on your PBGC benefit. To find out more, contact your state tax office (Excel file, 14.4 KB).
Also, if you receive a benefit from PBGC, we report the amount annually to the IRS.
For income tax purposes, each January PBGC sends you an IRS Form 1099-R that states the amount we paid you the previous year.
If you need a Form 1099-R for 2013 and haven't received it, PBGC will get you one.
The IRS has a tool, "Is My Pension or Annuity Payment Taxable?" that will help you determine if your pension or annuity payment from an employer-sponsored retirement plan is taxable.
President Barack Obama gives his State of the Union address on Capitol Hill in Washington, Tuesday Jan. 28, 2014. (AP Photo/Charles Dharapak)
In his fifth State of the Union address, President Barack Obama urged Congress to help restore opportunity for Americans, but pledged to take action himself.
In an effort to bolster retirement security, he announced that he will use his executive authority to direct the Department of the Treasury to create "myRA," a starter savings account to help people prepare for retirement.
In case you missed it, here's an excerpt from his speech:
"Let's do more to help Americans save for retirement. Today, most workers don't have a pension. A Social Security check often isn't enough on its own. And while the stock market has doubled over the last five years, that doesn't help folks who don't have 401ks. That's why, tomorrow, I will direct the Treasury to create a new way for working Americans to start their own retirement savings: MyRA. It's a new savings bond that encourages folks to build a nest egg. MyRA guarantees a decent return with no risk of losing what you put in..."
For a more in-depth explanation of "MyRA," read the White House issued FACT SHEET: Opportunity for All: Securing a Dignified Retirement for All Americans.
If you receive a retirement benefit from PBGC, all or some of the money may be taxable. Every year, we report this amount to the IRS and send you an IRS Form 1099-R that states the amount we paid you the previous year.
We'll mail your Form 1099-R for 2013 to your address of record by Friday, January 31, 2014. If you don't receive your form soon after the mailing date, we offer the following options:
- Use our online service, MyPBA, to view and print a copy of your 1099-R tax form for the most recent tax year.
- Call PBGC's Customer Contact Center at 1-800-400-7242 to request a form by mail.
Before you call, please have your Social Security number, plan name and case number ready for the customer service representative.
For more information, see IRS Form 1099-R Frequently Asked Questions.