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Technical Update 08-3: Waiver of Certain Reporting Requirements under ERISA Section 4010 for Controlled Groups with Aggregate Plan Underfunding Not Exceeding $15 Million

Technical Update Number:

This Technical Update waives annual financial and actuarial reporting under ERISA section 4010 in certain cases for controlled groups with aggregate plan underfunding of $15 million or less for information years beginning in 2008.


The Pension Protection Act of 2006 (PPA 2006) amended section 4010 of ERISA by changing the standards for determining which persons are required to file annual reports with PBGC under that section. PPA 2006 amended section 4010(b) of ERISA by changing one of the criteria under which controlled groups are required to file these annual reports. Before PPA 2006, ERISA section 4010(b)(1) required reporting if the aggregate unfunded vested benefits of all plans maintained by members of a controlled group exceeded $50 million, disregarding plans with no unfunded vested benefits. PPA 2006 amended ERISA section 4010(b)(1), replacing this $50 million trigger with a trigger requiring reporting if the funding target attainment percentage of any plan maintained by the contributing sponsor or a member of its controlled group is less than 80 percent.

On February 20, 2008 (at 73 FR 9243), PBGC published in the Federal Register a proposed rule to amend part 4010 of PBGC's regulations to implement PPA 2006 and to make other changes. Under the proposed rule, persons that would be required to file solely because one or more plans have a funding target attainment percentage of less than 80 percent would qualify for a waiver of reporting requirements if the aggregate underfunding for plans sponsored by members of the filer's controlled group was less than $15 million.


PBGC expects to issue a final rule amending part 4010 in early 2009. Pending issuance of the final rule, PBGC is implementing the $15 million waiver included in the proposed rule for the information year beginning in 2008. This will allow filers to rely on the waiver in determining whether they must file in 2009 for an information year beginning in 2008.

Thus, effective for information years beginning in 2008, reporting under ERISA section 4010 is waived (except as provided below) for a person (that would be a filer if not for the waiver) for the information year if, for the plan year ending within the information year, the aggregate 4010 funding shortfall for all plans (including any exempt plans) maintained by the person's controlled group (disregarding those plans with no funding shortfall) does not exceed $15 million. A plan's 4010 funding shortfall for purposes of this technical update is determined in the manner described in the proposed rule. In general, a plan's 4010 funding shortfall for a plan year equals the shortfall under ERISA section 303(c)(4) determined as of the valuation date for the plan year, except that the value of plan assets is determined without regard to the credit balance reduction under ERISA section 303(f)(4)(B).

This waiver does not apply if: (1) any member of the controlled group fails to make a required installment or other required payment to a plan and, as a result, the conditions for imposition of a lien described in ERISA section 303(k) and Code section 430(k) have been met during the information year, and the required installment or other required payment is not made within ten days of its due date; or (2) any plan maintained by a member of the controlled group has been granted one or more minimum funding waivers under ERISA section 302(c) and Code section 412(c) totaling in excess of $1 million, and as of the plan year ending within the information year, any portion of the waiver is outstanding.

PBGC Contact Points

For questions about this Technical Update 08-3, please contact Grace Kraemer of the Legislative and Regulatory Department at (202) 229-4223, ext. 3865, or or Amy Viener of the Policy, Research and Analysis Department at (202) 229-4080, ext. 3919, or