Worth Waiting For

In December, a day after U.S. House lawmakers unanimously approved a sweeping pension reform measure, the Senate followed suit with its own unanimous approval of the bill. The bill was signed into law on December 23. The House measure, H.R. 7237, which includes a one-year required minimum distribution (RMD) moratorium and a variety of pension funding provisions, passed out of the Senate as H.R. 6382, according to House and Senate records. In addition to the RMD issue, the bill includes a variety of pension funding measures and other provisions sought by retirement services industry trade groups.

For example, the bill features: clarification of pension plan “smoothing,” allowing plans to recognize unexpected asset gains and losses over 24 months; multiemployer plan relief, permitting plan sponsors to elect to temporarily freeze the status of certain multiemployer plans at the same funding status held in the previous plan year; a rule easing the requirement that otherwise would compel employers to restrict the accrual of pension benefits; and improved transition to the funding rules set by the PPA, in which the phased-in funding threshold would hold at 92% for another year.