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Workers & Retirees

If You Are Already Receiving Benefits

    • Introduction

      When PBGC takes over as statutory trustee of your plan, we will send you a letter informing you that we are now responsible for paying your pension benefits.

      PBGC reviews your plan's records to determine what benefits each person will receive.

      We will continue paying you without interruption during our review. These payments, an estimate of the benefits that PBGC can pay under the insurance program, may be less than you were receiving from your plan but will be paid in the annuity form you chose at retirement.

      We pay most benefits by Electronic Direct Deposit, sending your monthly payments directly to your financial institution. If you do not want to use direct deposit, you may still receive your benefit by check.

      When our calculations are complete, we will send you our formal determination of your benefit. Please note that this may take two to three years from the date we take over as trustee of your plan.

    • Guarantee Limits

      PBGC will pay you the benefit provided by your pension plan up to the limits set by law. There are several legal limits that PBGC must apply.

      Maximum Benefit Guarantee: PBGC's maximum benefit guarantee is set each year under provisions of ERISA. Under the single-employer program, the limit is adjusted annually based on changes in the Social Security contribution and benefit base. Generally, the maximum limit for any pension plan is permanently established for that plan based on the plan's termination date. However, when termination occurs during a plan sponsor's bankruptcy and the sponsor entered bankruptcy on or after September 16, 2006, the maximum guarantee is determined as of the date the bankruptcy proceeding began. An earlier date also may apply for certain airline industry plans.

      For 2011, the maximum guarantee is $54,000.00 yearly ($4,500.00 monthly) for a straight-life annuity beginning at age 65. This guarantee amount is lower if you begin receiving payments from PBGC before age 65 or if your pension includes benefits for a survivor or other beneficiary. The guarantee amount is higher if you are over age 65 when you begin receiving benefits from PBGC.

      For those already retired, the age used to determine the maximum guarantee is the participant's age as of the date of plan termination except for cases where termination occurs during a plan sponsor's bankruptcy or for certain airline industry plans, in which case an earlier date may apply.  See PBGC’s maximum monthly guarantee tables for maximum guarantee limits for straight-life and joint-and-50%-survivor annuities at various ages. Special rules may apply for disabled participants. See Guarantees for Disabled Participants.

      Phase-in of Guarantee of New Benefits: If your plan was created or amended to increase benefits within five years before its termination date, your benefit may not be fully guaranteed. PBGC guarantees the larger of 20% of the benefit or $20 per month for each full year the benefit was in effect. Participants may receive the full benefit increase if the increase has been in the plan more than five years. Generally, benefit increases occurring within one year of plan termination are not guaranteed. If you own more than 50% of the business, stricter limits apply. If you have a benefit increase as a result of the shutdown of a facility that occurs after July 26, 2005, and less than five years before your plan's termination date, the increase is not fully guaranteed. Different rules may apply if your plan terminated while the plan sponsor was in a bankruptcy proceeding or for certain airline industry plans.

      Supplemental Benefits: If your plan provides supplemental benefits, such as temporary payments, they may not be fully guaranteed. Generally, PBGC does not guarantee any monthly pension amount that is greater than the monthly benefit your plan would have provided if you had retired at your normal retirement age. Special rules may apply for disabled participants. See Guarantees for Disabled Participants.

      Benefits From More Than One Plan: There is a limit on the combined amount you can receive from PBGC's funds if you are entitled to benefits from more than one pension plan that PBGC has taken over as statutory trustee.

    • If PBGC’s Estimate is Too Low or Too High

      When we have completed our calculations:

      • If we have paid you an estimated benefit that is too low, we will make up the missed amounts in a single payment with interest.
      • If you receive estimated benefit payments that are too high, we will reduce future payments until the overpayment has been repaid.
      • Normally PBGC will reduce the monthly amount you are due by no more than 10% to collect for an overpayment.
      • PBGC does not charge interest on overpayments.
    • Cost-of-living Adjustment

      PBGC will not adjust your pension yearly to account for inflation.

    • Deductions

      PBGC only deducts federal income taxes. You will have to pay separately any state taxes or other amounts (such as health insurance) now being deducted.

    • Appealing Your Formal Determination

      You have the right to appeal PBGC's formal determination of your benefit. In any appeal you should provide specific reason(s) why the determination is wrong.

      However, if you simply have a question about your benefit or how it was calculated, you should call PBGC's Customer Contact Center for an explanation, instead of filing an appeal.

      Your written appeal must be submitted within 45 days of the date of our formal determination letter informing you of your benefit.

      If you need more time to resolve your question before that 45-day limit expires, you can request an extension from PBGC's Appeals Board.

      To find out more, see: Appeal formal determination

    • Payment Dates

      See when PBGC will be paying benefits by Electronic Direct Deposit (EDD) or by check for the current and future years.