Termination

Once irrevocable commitments are purchased, PBGC no longer guarantees the benefits.

Not appropriate to charge against plan assets legal fees arising from plan termination.

The obligation to pay premiums ceases when plan assets are distributed under priority categories 1- 6 without regard to whether there are residual assets.

A proposed plan distribution must be in compliance with § 4044 regardless of whether the IRS has issued a determination letter regarding a plan termination. IRS cannot issue an exception to section 4044.

Conversion from a covered plan to an individual account plan is a termination.

PBGC disapproves proposed plans that an employer wishes to adopt because they would effect an impermissible continuation of terminated plans for which guaranteed benefits are being paid.

A plan that in practice met the criteria for tax qualification for five years prior to its termination date was covered under Title IV at plan termination.

All affected parties may submit comments to PBGC on a proposed distress termination.

Discusses the rules governing plan termination and notes that the employers may owe withdrawal liability.

The sale by a parent corporation with a division that maintains a pension plan with nonforfeitable benefits which are not funded of $1 million or more of an incorporated subsidiary, irrespective of its relative size, results in a reportable event.