US Code

Public Law 119-73 (01/23/2026)

29 U.S.C. § 1056

Form and payment of benefits

(a)

Commencement date for payment of benefits

Each pension plan shall provide that unless the participant otherwise elects, the payment of benefits under the plan to the participant shall begin not later than the 60th day after the latest of the close of the plan year in which—
(1)
occurs the date on which the participant attains the earlier of age 65 or the normal retirement age specified under the plan,
(2)
occurs the 10th anniversary of the year in which the participant commenced participation in the plan, or
(3)
the participant terminates his service with the employer.
In the case of a plan which provides for the payment of an early retirement benefit, such plan shall provide that a participant who satisfied the service requirements for such early retirement benefit, but separated from the service (with any nonforfeitable right to an accrued benefit) before satisfying the age requirement for such early retirement benefit, is entitled upon satisfaction of such age requirement to receive a benefit not less than the benefit to which he would be entitled at the normal retirement age, actuarially reduced under regulations prescribed by the Secretary of the Treasury.
(b)

Decrease in plan benefits by reason of increases in benefit levels under Social Security Act or Railroad Retirement Act of 1937

If—
(1)
a participant or beneficiary is receiving benefits under a pension plan, or
(2)
a participant is separated from the service and has non-forfeitable rights to benefits,
42 U.S.C. 40145 U.S.C. 231a plan may not decrease benefits of such a participant by reason of any increase in the benefit levels payable under title II of the Social Security Act [ et seq.] or the Railroad Retirement Act of 1937 [ et seq.] or any increase in the wage base under such title II, if such increase takes place after , or (if later) the earlier of the date of first entitlement of such benefits or the date of such separation.
(c)

Forfeiture of accrued benefits derived from employer contributions

section 1053(a)(3)(D)(iii) of this titleNo pension plan may provide that any part of a participant’s accrued benefit derived from employer contributions (whether or not otherwise nonforfeitable) is forfeitable solely because of withdrawal by such participant of any amount attributable to the benefit derived from contributions made by such participant. The preceding sentence shall not apply (1) to the accrued benefit of any participant unless, at the time of such withdrawal, such participant has a nonforfeitable right to at least 50 percent of such accrued benefit, or (2) to the extent that an accrued benefit is permitted to be forfeited in accordance with .

(d)

Assignment or alienation of plan benefits

(1)
Each pension plan shall provide that benefits provided under the plan may not be assigned or alienated.
(2)
section 4975 of title 26section 4975(d)(1) of title 26 For the purposes of paragraph (1) of this subsection, there shall not be taken into account any voluntary and revocable assignment of not to exceed 10 percent of any benefit payment, or of any irrevocable assignment or alienation of benefits executed before . The preceding sentence shall not apply to any assignment or alienation made for the purposes of defraying plan administration costs. For purposes of this paragraph a loan made to a participant or beneficiary shall not be treated as an assignment or alienation if such loan is secured by the participant’s accrued non-forfeitable benefit and is exempt from the tax imposed by (relating to tax on prohibited transactions) by reason of .
(3)
(A)
Paragraph (1) shall apply to the creation, assignment, or recognition of a right to any benefit payable with respect to a participant pursuant to a domestic relations order, except that paragraph (1) shall not apply if the order is determined to be a qualified domestic relations order. Each pension plan shall provide for the payment of benefits in accordance with the applicable requirements of any qualified domestic relations order.
(B)
For purposes of this paragraph—
(i)
the term “qualified domestic relations order” means a domestic relations order—
(I)
which creates or recognizes the existence of an alternate payee’s right to, or assigns to an alternate payee the right to, receive all or a portion of the benefits payable with respect to a participant under a plan, and
(II)
with respect to which the requirements of subparagraphs (C) and (D) are met, and
(ii)
the term “domestic relations order” means any judgment, decree, or order (including approval of a property settlement agreement) which—
(I)
relates to the provision of child support, alimony payments, or marital property rights to a spouse, former spouse, child, or other dependent of a participant, and
(II)
is made pursuant to a State or Tribal domestic relations law (including a community property law).
section 7701(a)(40) of title 26For purposes of clause (ii)(II), the term “Tribal” with respect to a domestic relations law means such a law which is issued by or under the laws of an Indian tribal government (as defined in ), a subdivision of such an Indian tribal government, or an agency or instrumentality of either.
(C)
A domestic relations order meets the requirements of this subparagraph only if such order clearly specifies—
(i)
the name and the last known mailing address (if any) of the participant and the name and mailing address of each alternate payee covered by the order,
(ii)
the amount or percentage of the participant’s benefits to be paid by the plan to each such alternate payee, or the manner in which such amount or percentage is to be determined,
(iii)
the number of payments or period to which such order applies, and
(iv)
each plan to which such order applies.
(D)
A domestic relations order meets the requirements of this subparagraph only if such order—
(i)
does not require a plan to provide any type or form of benefit, or any option, not otherwise provided under the plan,
(ii)
does not require the plan to provide increased benefits (determined on the basis of actuarial value), and
(iii)
does not require the payment of benefits to an alternate payee which are required to be paid to another alternate payee under another order previously determined to be a qualified domestic relations order.
(E)
(i)
A domestic relations order shall not be treated as failing to meet the requirements of clause (i) of subparagraph (D) solely because such order requires that payment of benefits be made to an alternate payee—
(I)
in the case of any payment before a participant has separated from service, on or after the date on which the participant attains (or would have attained) the earliest retirement age,
(II)
as if the participant had retired on the date on which such payment is to begin under such order (but taking into account only the present value of benefits actually accrued and not taking into account the present value of any employer subsidy for early retirement), and
(III)
in any form in which such benefits may be paid under the plan to the participant (other than in the form of a joint and survivor annuity with respect to the alternate payee and his or her subsequent spouse).
For purposes of subclause (II), the interest rate assumption used in determining the present value shall be the interest rate specified in the plan or, if no rate is specified, 5 percent.
(ii)
For purposes of this subparagraph, the term “earliest retirement age” means the earlier of—
(I)
the date on which the participant is entitled to a distribution under the plan, or
(II)
1
1 So in original. The word “of” probably should not appear.
the later of the date of  the participant attains age 50 or the earliest date on which the participant could begin receiving benefits under the plan if the participant separated from service.
(F)
To the extent provided in any qualified domestic relations order—
(i)
section 1055 of this title the former spouse of a participant shall be treated as a surviving spouse of such participant for purposes of (and any spouse of the participant shall not be treated as a spouse of the participant for such purposes), and
(ii)
section 1055(f) of this title if married for at least 1 year, the surviving former spouse shall be treated as meeting the requirements of .
(G)
(i)
In the case of any domestic relations order received by a plan—
(I)
the plan administrator shall promptly notify the participant and each alternate payee of the receipt of such order and the plan’s procedures for determining the qualified status of domestic relations orders, and
(II)
within a reasonable period after receipt of such order, the plan administrator shall determine whether such order is a qualified domestic relations order and notify the participant and each alternate payee of such determination.
(ii)
Each plan shall establish reasonable procedures to determine the qualified status of domestic relations orders and to administer distributions under such qualified orders. Such procedures—
(I)
shall be in writing,
(II)
shall provide for the notification of each person specified in a domestic relations order as entitled to payment of benefits under the plan (at the address included in the domestic relations order) of such procedures promptly upon receipt by the plan of the domestic relations order, and
(III)
shall permit an alternate payee to designate a representative for receipt of copies of notices that are sent to the alternate payee with respect to a domestic relations order.
(H)
(i)
During any period in which the issue of whether a domestic relations order is a qualified domestic relations order is being determined (by the plan administrator, by a court of competent jurisdiction, or otherwise), the plan administrator shall separately account for the amounts (hereinafter in this subparagraph referred to as the “segregated amounts”) which would have been payable to the alternate payee during such period if the order had been determined to be a qualified domestic relations order.
(ii)
If within the 18-month period described in clause (v) the order (or modification thereof) is determined to be a qualified domestic relations order, the plan administrator shall pay the segregated amounts (including any interest thereon) to the person or persons entitled thereto.
(iii)
If within the 18-month period described in clause (v)—
(I)
it is determined that the order is not a qualified domestic relations order, or
(II)
the issue as to whether such order is a qualified domestic relations order is not resolved,
then the plan administrator shall pay the segregated amounts (including any interest thereon) to the person or persons who would have been entitled to such amounts if there had been no order.
(iv)
Any determination that an order is a qualified domestic relations order which is made after the close of the 18-month period described in clause (v) shall be applied prospectively only.
(v)
For purposes of this subparagraph, the 18-month period described in this clause is the 18-month period beginning with the date on which the first payment would be required to be made under the domestic relations order.
(I)
If a plan fiduciary acts in accordance with part 4 of this subtitle in—
(i)
treating a domestic relations order as being (or not being) a qualified domestic relations order, or
(ii)
taking action under subparagraph (H),
then the plan’s obligation to the participant and each alternate payee shall be discharged to the extent of any payment made pursuant to such Act.
(J)
section 1301 of this title A person who is an alternate payee under a qualified domestic relations order shall be considered for purposes of any provision of this chapter a beneficiary under the plan. Nothing in the preceding sentence shall permit a requirement under of the payment of more than 1 premium with respect to a participant for any period.
(K)
The term “alternate payee” means any spouse, former spouse, child, or other dependent of a participant who is recognized by a domestic relations order as having a right to receive all, or a portion of, the benefits payable under a plan with respect to such participant.
(L)
This paragraph shall not apply to any plan to which paragraph (1) does not apply.
(M)
section 1673(a) of title 15 Payment of benefits by a pension plan in accordance with the applicable requirements of a qualified domestic relations order shall not be treated as garnishment for purposes of .
(N)
In prescribing regulations under this paragraph, the Secretary shall consult with the Secretary of the Treasury.
(4)
Paragraph (1) shall not apply to any offset of a participant’s benefits provided under an employee pension benefit plan against an amount that the participant is ordered or required to pay to the plan if—
(A)
the order or requirement to pay arises—
(i)
under a judgment of conviction for a crime involving such plan,
(ii)
under a civil judgment (including a consent order or decree) entered by a court in an action brought in connection with a violation (or alleged violation) of part 4 of this subtitle, or
(iii)
pursuant to a settlement agreement between the Secretary and the participant, or a settlement agreement between the Pension Benefit Guaranty Corporation and the participant, in connection with a violation (or alleged violation) of part 4 of this subtitle by a fiduciary or any other person,
(B)
the judgment, order, decree, or settlement agreement expressly provides for the offset of all or part of the amount ordered or required to be paid to the plan against the participant’s benefits provided under the plan, and
(C)
section 1055 of this title in a case in which the survivor annuity requirements of apply with respect to distributions from the plan to the participant, if the participant has a spouse at the time at which the offset is to be made—
(i)
either—
(I)
section 1055(c)(2)(B) of this title such spouse has consented in writing to such offset and such consent is witnessed by a notary public or representative of the plan (or it is established to the satisfaction of a plan representative that such consent may not be obtained by reason of circumstances described in ), or
(II)
section 1055(c) of this title an election to waive the right of the spouse to a qualified joint and survivor annuity or a qualified preretirement survivor annuity is in effect in accordance with the requirements of ,
(ii)
such spouse is ordered or required in such judgment, order, decree, or settlement to pay an amount to the plan in connection with a violation of part 4 of this subtitle, or
(iii)
section 1055(a)(1) of this titlesection 1055(a)(2) of this title in such judgment, order, decree, or settlement, such spouse retains the right to receive the survivor annuity under a qualified joint and survivor annuity provided pursuant to and under a qualified preretirement survivor annuity provided pursuant to , determined in accordance with paragraph (5).
section 1055 of this titleA plan shall not be treated as failing to meet the requirements of solely by reason of an offset under this paragraph.
(5)
(A)
The survivor annuity described in paragraph (4)(C)(iii) shall be determined as if—
(i)
the participant terminated employment on the date of the offset,
(ii)
there was no offset,
(iii)
the plan permitted commencement of benefits only on or after normal retirement age,
(iv)
the plan provided only the minimum-required qualified joint and survivor annuity, and
(v)
the amount of the qualified preretirement survivor annuity under the plan is equal to the amount of the survivor annuity payable under the minimum-required qualified joint and survivor annuity.
(B)
section 1002(23) of this title For purposes of this paragraph, the term “minimum-required qualified joint and survivor annuity” means the qualified joint and survivor annuity which is the actuarial equivalent of the participant’s accrued benefit (within the meaning of ) and under which the survivor annuity is 50 percent of the amount of the annuity which is payable during the joint lives of the participant and the spouse.
(e)

Limitation on distributions other than life annuities paid by plan

(1)

In general

section 1083(j)(4) of this titlesection 1083(j)(4)(E)(i) of this titleNotwithstanding any other provision of this part, the fiduciary of a pension plan that is subject to the additional funding requirements of shall not permit a prohibited payment to be made from a plan during a period in which such plan has a liquidity shortfall (as defined in ).

(2)

Prohibited payment

For purposes of paragraph (1), the term “prohibited payment” means—
(A)
section 1054(b)(1)(G) of this titlesection 1055(h)(2) of this title any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of ), to a participant or beneficiary whose annuity starting date (as defined in ), that occurs during the period referred to in paragraph (1),
(B)
any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and
(C)
any other payment specified by the Secretary of the Treasury by regulations.
(3)

Period of shortfall

section 1083(j)(3) of this titlesection 1083(j)(4)(A) of this titleFor purposes of this subsection, a plan has a liquidity shortfall during the period that there is an underpayment of an installment under by reason of .

(4)

Coordination with other provisions

Compliance with this subsection shall not constitute a violation of any other provision of this chapter.

(f)

Missing participants in terminated plans

section 1350 of this titlesection 1350 of this titleIn the case of a plan covered by , upon termination of the plan, benefits of missing participants shall be treated in accordance with .

(g)

Funding-based limits on benefits and benefit accruals under single-employer plans

(1)

Funding-based limitation on shutdown benefits and other unpredictable contingent event benefits under single-employer plans

(A)

In general

If a participant of a defined benefit plan which is a single-employer plan is entitled to an unpredictable contingent event benefit payable with respect to any event occurring during any plan year, the plan shall provide that such benefit may not be provided if the adjusted funding target attainment percentage for such plan year—
(i)
is less than 60 percent, or
(ii)
would be less than 60 percent taking into account such occurrence.
(B)

Exemption

section 1083 of this titleSubparagraph (A) shall cease to apply with respect to any plan year, effective as of the first day of the plan year, upon payment by the plan sponsor of a contribution (in addition to any minimum required contribution under ) equal to—
(i)
section 1083 of this title in the case of subparagraph (A)(i), the amount of the increase in the funding target of the plan (under ) for the plan year attributable to the occurrence referred to in subparagraph (A), and
(ii)
in the case of subparagraph (A)(ii), the amount sufficient to result in an adjusted funding target attainment percentage of 60 percent.
(C)

Unpredictable contingent event benefit

For purposes of this paragraph, the term “unpredictable contingent event benefit” means any benefit payable solely by reason of—
(i)
a plant shutdown (or similar event, as determined by the Secretary of the Treasury), or
(ii)
an event other than the attainment of any age, performance of any service, receipt or derivation of any compensation, or occurrence of death or disability.
(2)

Limitations on plan amendments increasing liability for benefits

(A)

In general

No amendment to a defined benefit plan which is a single-employer plan which has the effect of increasing liabilities of the plan by reason of increases in benefits, establishment of new benefits, changing the rate of benefit accrual, or changing the rate at which benefits become nonforfeitable may take effect during any plan year if the adjusted funding target attainment percentage for such plan year is—
(i)
less than 80 percent, or
(ii)
would be less than 80 percent taking into account such amendment.
(B)

Exemption

section 1083 of this titleSubparagraph (A) shall cease to apply with respect to any plan year, effective as of the first day of the plan year (or if later, the effective date of the amendment), upon payment by the plan sponsor of a contribution (in addition to any minimum required contribution under ) equal to—
(i)
section 1083 of this title in the case of subparagraph (A)(i), the amount of the increase in the funding target of the plan (under ) for the plan year attributable to the amendment, and
(ii)
in the case of subparagraph (A)(ii), the amount sufficient to result in an adjusted funding target attainment percentage of 80 percent.
(C)

Exception for certain benefit increases

Subparagraph (A) shall not apply to any amendment which provides for an increase in benefits under a formula which is not based on a participant’s compensation, but only if the rate of such increase is not in excess of the contemporaneous rate of increase in average wages of participants covered by the amendment.

(3)

Limitations on accelerated benefit distributions

(A)

Funding percentage less than 60 percent

A defined benefit plan which is a single-employer plan shall provide that, in any case in which the plan’s adjusted funding target attainment percentage for a plan year is less than 60 percent, the plan may not pay any prohibited payment after the valuation date for the plan year.

(B)

Bankruptcy

section 1083(h)(2)(C)(iv) of this titleA defined benefit plan which is a single-employer plan shall provide that, during any period in which the plan sponsor is a debtor in a case under title 11 or similar Federal or State law, the plan may not pay any prohibited payment. The preceding sentence shall not apply on or after the date on which the enrolled actuary of the plan certifies that the adjusted funding target attainment percentage of such plan (determined by not taking into account any adjustment of segment rates under ) is not less than 100 percent.

(C)

Limited payment if percentage at least 60 percent but less than 80 percent

(i)

In general

A defined benefit plan which is a single-employer plan shall provide that, in any case in which the plan’s adjusted funding target attainment percentage for a plan year is 60 percent or greater but less than 80 percent, the plan may not pay any prohibited payment after the valuation date for the plan year to the extent the amount of the payment exceeds the lesser of—
(I)
50 percent of the amount of the payment which could be made without regard to this subsection, or
(II)
section 1055(g) of this titlesection 1322 of this title the present value (determined under guidance prescribed by the Pension Benefit Guaranty Corporation, using the interest and mortality assumptions under ) of the maximum guarantee with respect to the participant under .
(ii)

One-time application

(I)

In general

The plan shall also provide that only 1 prohibited payment meeting the requirements of clause (i) may be made with respect to any participant during any period of consecutive plan years to which the limitations under either subparagraph (A) or (B) or this subparagraph applies.

(II)

Treatment of beneficiaries

For purposes of this clause, a participant and any beneficiary on his behalf (including an alternate payee, as defined in subsection (d)(3)(K)) shall be treated as 1 participant. If the accrued benefit of a participant is allocated to such an alternate payee and 1 or more other persons, the amount under clause (i) shall be allocated among such persons in the same manner as the accrued benefit is allocated unless the qualified domestic relations order (as defined in subsection (d)(3)(B)(i)) provides otherwise.

(D)

Exception

This paragraph shall not apply to any plan for any plan year if the terms of such plan (as in effect for the period beginning on , and ending with such plan year) provide for no benefit accruals with respect to any participant during such period.

(E)

Prohibited payment

2
2 So in original. Probably should be “purposes”.
For purpose  of this paragraph, the term “prohibited payment” means—
(i)
section 1054(b)(1)(G) of this titlesection 1055(h)(2) of this title any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of ), to a participant or beneficiary whose annuity starting date (as defined in ) occurs during any period a limitation under subparagraph (A) or (B) is in effect,
(ii)
any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and
(iii)
any other payment specified by the Secretary of the Treasury by regulations.
section 1053(e) of this titleSuch term shall not include the payment of a benefit which under may be immediately distributed without the consent of the participant.
(4)

Limitation on benefit accruals for plans with severe funding shortfalls

(A)

In general

A defined benefit plan which is a single-employer plan shall provide that, in any case in which the plan’s adjusted funding target attainment percentage for a plan year is less than 60 percent, benefit accruals under the plan shall cease as of the valuation date for the plan year.

(B)

Exemption

section 1083 of this titleSubparagraph (A) shall cease to apply with respect to any plan year, effective as of the first day of the plan year, upon payment by the plan sponsor of a contribution (in addition to any minimum required contribution under ) equal to the amount sufficient to result in an adjusted funding target attainment percentage of 60 percent.

(5)

Rules relating to contributions required to avoid benefit limitations

(A)

Security may be provided

(i)

In general

For purposes of this subsection, the adjusted funding target attainment percentage shall be determined by treating as an asset of the plan any security provided by a plan sponsor in a form meeting the requirements of clause (ii).

(ii)

Form of security

The security required under clause (i) shall consist of—
(I)
section 1112 of this title a bond issued by a corporate surety company that is an acceptable surety for purposes of ,
(II)
cash, or United States obligations which mature in 3 years or less, held in escrow by a bank or similar financial institution, or
(III)
such other form of security as is satisfactory to the Secretary of the Treasury and the parties involved.
(iii)

Enforcement

Any security provided under clause (i) may be perfected and enforced at any time after the earlier of—
(I)
the date on which the plan terminates,
(II)
section 1083(j) of this title if there is a failure to make a payment of the minimum required contribution for any plan year beginning after the security is provided, the due date for the payment under , or
(III)
if the adjusted funding target attainment percentage is less than 60 percent for a consecutive period of 7 years, the valuation date for the last year in the period.
(iv)

Release of security

The security shall be released (and any amounts thereunder shall be refunded together with any interest accrued thereon) at such time as the Secretary of the Treasury may prescribe in regulations, including regulations for partial releases of the security by reason of increases in the adjusted funding target attainment percentage.

(B)

Prefunding balance or funding standard carryover balance may not be used

section 1083(f) of this titleNo prefunding balance or funding standard carryover balance under may be used under paragraph (1), (2), or (4) to satisfy any payment an employer may make under any such paragraph to avoid or terminate the application of any limitation under such paragraph.

(C)

Deemed reduction of funding balances

(i)

In general

section 1083(f) of this titleSubject to clause (iii), in any case in which a benefit limitation under paragraph (1), (2), (3), or (4) would (but for this subparagraph and determined without regard to paragraph (1)(B), (2)(B), or (4)(B)) apply to such plan for the plan year, the plan sponsor of such plan shall be treated for purposes of this chapter as having made an election under to reduce the prefunding balance or funding standard carryover balance by such amount as is necessary for such benefit limitation to not apply to the plan for such plan year.

(ii)

Exception for insufficient funding balances

Clause (i) shall not apply with respect to a benefit limitation for any plan year if the application of clause (i) would not result in the benefit limitation not applying for such plan year.

(iii)

Restrictions of certain rules to collectively bargained plans

With respect to any benefit limitation under paragraph (1), (2), or (4), clause (i) shall only apply in the case of a plan maintained pursuant to 1 or more collective bargaining agreements between employee representatives and 1 or more employers.

(6)

New plans

Paragraphs (1), (2), and (4) shall not apply to a plan for the first 5 plan years of the plan. For purposes of this paragraph, the reference in this paragraph to a plan shall include a reference to any predecessor plan.

(7)

Presumed underfunding for purposes of benefit limitations

(A)

Presumption of continued underfunding

In any case in which a benefit limitation under paragraph (1), (2), (3), or (4) has been applied to a plan with respect to the plan year preceding the current plan year, the adjusted funding target attainment percentage of the plan for the current plan year shall be presumed to be equal to the adjusted funding target attainment percentage of the plan for the preceding plan year until the enrolled actuary of the plan certifies the actual adjusted funding target attainment percentage of the plan for the current plan year.

(B)

Presumption of underfunding after 10th month

In any case in which no certification of the adjusted funding target attainment percentage for the current plan year is made with respect to the plan before the first day of the 10th month of such year, for purposes of paragraphs (1), (2), (3), and (4), such first day shall be deemed, for purposes of such paragraph, to be the valuation date of the plan for the current plan year and the plan’s adjusted funding target attainment percentage shall be conclusively presumed to be less than 60 percent as of such first day.

(C)

Presumption of underfunding after 4th month for nearly underfunded plans

In any case in which—
(i)
a benefit limitation under paragraph (1), (2), (3), or (4) did not apply to a plan with respect to the plan year preceding the current plan year, but the adjusted funding target attainment percentage of the plan for such preceding plan year was not more than 10 percentage points greater than the percentage which would have caused such paragraph to apply to the plan with respect to such preceding plan year, and
(ii)
as of the first day of the 4th month of the current plan year, the enrolled actuary of the plan has not certified the actual adjusted funding target attainment percentage of the plan for the current plan year,
until the enrolled actuary so certifies, such first day shall be deemed, for purposes of such paragraph, to be the valuation date of the plan for the current plan year and the adjusted funding target attainment percentage of the plan as of such first day shall, for purposes of such paragraph, be presumed to be equal to 10 percentage points less than the adjusted funding target attainment percentage of the plan for such preceding plan year.
(8)

Treatment of plan as of close of prohibited or cessation period

For purposes of applying this part—
(A)

Operation of plan after period

Unless the plan provides otherwise, payments and accruals will resume effective as of the day following the close of the period for which any limitation of payment or accrual of benefits under paragraph (3) or (4) applies.

(B)

Treatment of affected benefits

Nothing in this paragraph shall be construed as affecting the plan’s treatment of benefits which would have been paid or accrued but for this subsection.

(9)

Terms relating to funding target attainment percentage

For purposes of this subsection—
(A)

In general

section 1083(d)(2) of this titleThe term “funding target attainment percentage” has the same meaning given such term by .

(B)

Adjusted funding target attainment percentage

section 1083(d)(2) of this titlesection 414(q) of title 26The term “adjusted funding target attainment percentage” means the funding target attainment percentage which is determined under subparagraph (A) by increasing each of the amounts under subparagraphs (A) and (B) of by the aggregate amount of purchases of annuities for employees other than highly compensated employees (as defined in ) which were made by the plan during the preceding 2 plan years.

(C)

Application to plans which are fully funded without regard to reductions for funding balances

section 1083(f)(4) of this titleIn the case of a plan for any plan year, if the funding target attainment percentage is 100 percent or more (determined without regard to the reduction in the value of assets under ), the funding target attainment percentage for purposes of subparagraphs (A) and (B) shall be determined without regard to such reduction.

(10)

Secretarial authority for plans with alternate valuation date

In the case of a plan which has designated a valuation date other than the first day of the plan year, the Secretary of the Treasury may prescribe rules for the application of this subsection which are necessary to reflect the alternate valuation date.

[(11)

Pub. L. 113–295, div. A, title II, § 221(a)(57)(G)(ii)128 Stat. 4047 Repealed. , , ]

(12)

CSEC plans

section 1060(f) of this titleThis subsection shall not apply to a CSEC plan (as defined in ).

(h)

Special rules applicable to benefit overpayments

(1)

General rule

In the case of an inadvertent benefit overpayment by any pension plan, the responsible plan fiduciary shall not be considered to have failed to comply with the requirements of this subchapter merely because such fiduciary determines, in the exercise of its discretion, not to seek recovery of all or part of such overpayment from—
(A)
any participant or beneficiary,
(B)
any plan sponsor of, or contributing employer to—
(i)
section 1053 of this title an individual account plan, provided that the amount needed to prevent or restore any impermissible forfeiture from any participant’s or beneficiary’s account arising in connection with the overpayment is, separately from and independently of the overpayment, allocated to such account pursuant to the nonforfeitability requirements of (for example, out of the plan’s forfeiture account, additional employer contributions, or recoveries from those responsible for the overpayment), or
(ii)
a defined benefit pension plan subject to the funding rules in part 3 of this subtitle B, unless the responsible plan fiduciary determines, in the exercise of its fiduciary discretion, that failure to recover all or part of the overpayment faster than required under such funding rules would materially affect the plan’s ability to pay benefits due to other participants and beneficiaries, or
(C)
any fiduciary of the plan, other than a fiduciary (including a plan sponsor or contributing employer acting in a fiduciary capacity) whose breach of its fiduciary duties resulted in such overpayment, provided that if the plan has established prudent procedures to prevent and minimize overpayment of benefits and the relevant plan fiduciaries have followed such procedures, an inadvertent benefit overpayment will not give rise to a breach of fiduciary duty.
(2)

Reduction in future benefit payments and recovery from responsible party

Paragraph (1) shall not fail to apply with respect to any inadvertent benefit overpayment merely because, after discovering such overpayment, the responsible plan fiduciary—
(A)
reduces future benefit payments to the correct amount provided for under the terms of the plan, or
(B)
seeks recovery from the person or persons responsible for the overpayment.
(3)

Employer funding obligations

section 1053 of this titleNothing in this subsection shall relieve an employer of any obligation imposed on it to make contributions to a plan to meet the minimum funding standards under part 3 of this subtitle B or to prevent or restore an impermissible forfeiture in accordance with .

(4)

Recoupment from participants and beneficiaries

If the responsible plan fiduciary, in the exercise of its fiduciary discretion, decides to seek recoupment from a participant or beneficiary of all or part of an inadvertent benefit overpayment made by the plan to such participant or beneficiary, it may do so, subject to the following conditions:
(A)
No interest or other additional amounts (such as collection costs or fees) are sought on overpaid amounts for any period.
(B)
If the plan seeks to recoup past overpayments of a non-decreasing annuity by reducing future benefit payments—
(i)
the reduction ceases after the plan has recovered the full dollar amount of the overpayment,
(ii)
the amount recouped each calendar year does not exceed 10 percent of the full dollar amount of the overpayment, and
(iii)
future benefit payments are not reduced to below 90 percent of the periodic amount otherwise payable under the terms of the plan.
Alternatively, if the plan seeks to recoup past overpayments of a non-decreasing annuity through one or more installment payments, the sum of such installment payments in any calendar year does not exceed the sum of the reductions that would be permitted in such year under the preceding sentence.
(C)
If the plan seeks to recoup past overpayments of a benefit other than a non-decreasing annuity, the plan satisfies requirements developed by the Secretary of Labor for purposes of this subparagraph.
(D)
Efforts to recoup overpayments are—
(i)
not accompanied by threats of litigation, unless the responsible plan fiduciary makes a determination that there is a reasonable likelihood of success to recover an amount greater than the cost of recovery, and
(ii)
not made through a collection agency or similar third party, unless the participant or beneficiary ignores or rejects efforts to recoup the overpayment following either a final judgment in Federal or State court or a settlement between the participant or beneficiary and the plan, in either case authorizing such recoupment.
(E)
Recoupment of past overpayments to a participant is not sought from any beneficiary of the participant, including a spouse, surviving spouse, former spouse, or other beneficiary.
(F)
Recoupment may not be sought if the first overpayment occurred more than 3 years before the participant or beneficiary is first notified in writing of the error, except in the case of fraud or misrepresentation by the participant.
(G)
section 1133 of this titlesection 402(c)(8)(B) of title 26 A participant or beneficiary from whom recoupment is sought is entitled to contest all or part of the recoupment pursuant to the claims procedures of the plan that made the overpayment to the extent such procedures are consistent with and in the case of an inadvertent benefit overpayment from a plan to which paragraph (1) applies that is transferred to an eligible retirement plan (as defined in ) by or on behalf of a participant or beneficiary—
(i)
such plan shall notify the plan receiving the rollover of such dispute,
(ii)
the plan receiving the rollover shall retain such overpayment on behalf of the participant or beneficiary (and shall be entitled to treat such overpayment as plan assets) pending the outcome of such procedures, and
(iii)
the portion of such overpayment with respect to which recoupment is sought on behalf of the plan shall be permitted to be returned to such plan if it is determined to be an overpayment (and the plans making and receiving such transfer shall be treated as permitting such transfer).
(H)
In determining the amount of recoupment to seek, the responsible plan fiduciary may take into account the hardship that recoupment likely would impose on the participant or beneficiary.
(5)

Effect of culpability

Subparagraphs (A) through (F) of paragraph (4) shall not apply to protect a participant or beneficiary who is culpable. For purposes of this paragraph, a participant or beneficiary is culpable if the individual bears responsibility for the overpayment (such as through misrepresentations or omissions that led to the overpayment), or if the individual knew that the benefit payment or payments were materially in excess of the correct amount. Notwithstanding the preceding sentence, an individual is not culpable merely because the individual believed the benefit payment or payments were or might be in excess of the correct amount, if the individual raised that question with an authorized plan representative and was told the payment or payments were not in excess of the correct amount.

Pub. L. 93–406, title I, § 20688 Stat. 864Pub. L. 98–397, title I, § 104(a)98 Stat. 1433Pub. L. 99–514, title XVIII, § 1898(c)(2)(B)100 Stat. 2952–2954Pub. L. 101–239, title VII103 Stat. 2445Pub. L. 103–465, title VII108 Stat. 5033Pub. L. 105–34, title XV, § 1502(a)111 Stat. 1058Pub. L. 109–280, title I120 Stat. 809Pub. L. 111–192, title II, § 202(a)124 Stat. 1297Pub. L. 110–458, title I, § 101(c)(1)(B)122 Stat. 5097Pub. L. 111–192, title II, § 203(a)(1)124 Stat. 1299Pub. L. 113–97, title I, § 102(b)(3)128 Stat. 1116Pub. L. 113–159, title II, § 2003(c)(2)128 Stat. 1850Pub. L. 113–295, div. A, title II, § 221(a)(57)(E)(ii)128 Stat. 4046Pub. L. 117–328, div. T, title III136 Stat. 5335(, , ; , , ; , (4)(B), (5), (6)(B), (7)(B), , ; , §§ 7891(a)(1), 7894(c)(8), (9)(A), , , 2449; , §§ 761(a)(9)(B)(i), 776(c)(2), , , 5048; , , ; , §§ 103(a), 108(a)(9), (10), formerly § 107(a)(9), (10), title IV, § 410(b), , , 819, 935, renumbered , , ; –(G), , ; , , ; , , ; , , ; , (F)(ii), (G)(ii), , , 4047; , §§ 301(a), 339(b), , , 5375.)

Editorial Notes

References in Text

act Aug. 14, 1935, ch. 53149 Stat. 620section 1305 of Title 42The Social Security Act, referred to in subsec. (b), is , . Title II of the Social Security Act is classified generally to subchapter II (§ 401 et seq.) of chapter 7 of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see and Tables.

act Aug. 29, 1935, ch. 81249 Stat. 967act June 24, 1937, ch. 382, part I50 Stat. 307Pub. L. 93–445, title I88 Stat. 1305The Railroad Retirement Act of 1937, referred to in subsec. (b), is , , as amended generally by , , and which was classified principally to subchapter III (§ 228a et seq.) of chapter 9 of Title 45, Railroads. The Railroad Retirement Act of 1937 was amended generally and redesignated the Railroad Retirement Act of 1974 by , , . The Railroad Retirement Act of 1974 is classified generally to subchapter IV (§ 231 et seq.) of chapter 9 of Title 45. For complete classification of these acts to the Code, see Tables.

Pub. L. 93–406section 1001 of this titleThis chapter, referred to in subsecs. (e)(4) and (g)(5)(C)(i), was in the original “this Act”, meaning , known as the Employee Retirement Income Security Act of 1974. Titles I, III, and IV of such Act are classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under and Tables.

Amendments

Pub. L. 117–328, § 339(b)(2)2022—Subsec. (d)(3)(B). , inserted concluding provisions.

Pub. L. 117–328, § 339(b)(1)Subsec. (d)(3)(B)(ii)(II). , inserted “or Tribal” after “State”.

Pub. L. 117–328, § 301(a)Subsec. (h). , added subsec. (h).

Pub. L. 113–159section 1083(h)(2)(C)(iv) of this title2014—Subsec. (g)(3)(B). substituted “of such plan (determined by not taking into account any adjustment of segment rates under )” for “of such plan”.

Pub. L. 113–295, § 221(a)(57)(E)(ii)Subsec. (g)(9)(C). , struck out cl. (i) designation and heading and struck out cls. (ii) and (iii) which related to transition rule for plan years 2008 to 2010 and limitation on transition rule, respectively.

Pub. L. 113–295, § 221(a)(57)(F)(ii)Subsec. (g)(9)(D). , struck out subpar. (D) which related to special rule for certain years.

Pub. L. 113–295, § 221(a)(57)(G)(ii)Subsec. (g)(11). , struck out par. (11). Text read as follows: “For purposes of this subsection, in the case of plan years beginning in 2008, the funding target attainment percentage for the preceding plan year may be determined using such methods of estimation as the Secretary of the Treasury may provide.”

Pub. L. 113–97Subsec. (g)(12). added par. (12).

Pub. L. 111–192, § 203(a)(1)2010—Subsec. (g)(9)(D). , added subpar. (D).

Pub. L. 110–458, § 101(c)(1)(B)2008—Subsec. (g)(1)(B)(ii). , substituted “an adjusted funding” for “a funding”.

Pub. L. 110–458, § 101(c)(1)(C)Subsec. (g)(1)(C). , inserted “benefit” after “event” in heading.

Pub. L. 110–458, § 101(c)(1)(D)Subsec. (g)(3)(E). , inserted concluding provisions.

Pub. L. 110–458, § 101(c)(1)(E)Subsec. (g)(5)(A)(iv). , inserted “adjusted” before “funding”.

Pub. L. 110–458, § 101(c)(1)(F)section 1083(f)(4) of this titleSubsec. (g)(9)(C). , in cl. (i), struck out “without regard to this subparagraph and” before “without regard to the reduction” and, in cl. (iii), substituted “without regard to the reduction in the value of assets under ” for “without regard to this subparagraph” and inserted “beginning” before “after” in two places.

Pub. L. 110–458, § 101(c)(1)(G)Subsec. (g)(10), (11). , added par. (10) and redesignated former par. (10) as (11).

Pub. L. 109–280, § 108(a)(9)Pub. L. 111–192, § 202(a)2006—Subsec. (e)(1). , formerly § 107(a)(9), as renumbered by , substituted “1083(j)(4)” for “1082(d)” and “1083(j)(4)(E)(i)” for “1082(e)(5)”.

Pub. L. 109–280, § 108(a)(10)Pub. L. 111–192, § 202(a)section 1083(j)(3) of this titlesection 1083(j)(4)(A) of this titlesection 1082(e) of this titleSubsec. (e)(3). , formerly § 107(a)(10), as renumbered by , substituted “ by reason of ” for “ by reason of paragraph (5)(A) thereof”.

Pub. L. 109–280, § 410(b)section 1350 of this titleSubsec. (f). , substituted “” for “subchapter III of this chapter, the plan shall provide that”.

Pub. L. 109–280, § 103(a)Subsec. (g). , added subsec. (g).

Pub. L. 105–341997—Subsec. (d)(4), (5). added pars. (4) and (5).

Pub. L. 103–465, § 761(a)(9)(B)(i)1994—Subsec. (e). , added subsec. (e).

Pub. L. 103–465, § 776(c)(2)Subsec. (f). , added subsec. (f).

Pub. L. 101–239, § 7894(c)(8)1989—Subsec. (a)(1). , inserted “occurs” before “the date”.

Pub. L. 101–239, § 7891(a)(1)Subsec. (d)(2). , substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text.

Pub. L. 101–239, § 7894(c)(9)(A)Subsec. (d)(3)(I). , substituted “such Act” for “such act”.

Pub. L. 99–514, § 1898(c)(7)(B)(iii)1986—Subsec. (d)(3)(E)(i). , substituted “A” for “In the case of any payment before a participant has separated from service, a” in introductory provisions and inserted “in the case of any payment before a participant has separated from service,” in subcl. (I).

Pub. L. 99–514, § 1898(c)(7)(B)(iv)section 1055(h)(3) of this titleSubsec. (d)(3)(E)(ii). , amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “For purposes of this subparagraph, the term ‘earliest retirement age’ has the meaning given such term by , except that in the case of any individual account plan, the earliest retirement age shall be the date which is 10 years before the normal retirement age.”

Pub. L. 99–514, § 1898(c)(6)(B)Subsec. (d)(3)(F)(i). , inserted “(and any spouse of the participant shall not be treated as a spouse of the participant for such purposes)”.

Pub. L. 99–514, § 1898(c)(7)(B)(i)Subsec. (d)(3)(F)(ii). , inserted “surviving” before “former spouse”.

Pub. L. 99–514, § 1898(c)(7)(B)(ii)Subsec. (d)(3)(G)(i)(I). , substituted “each” for “any other”.

Pub. L. 99–514, § 1898(c)(2)(B)(i)Subsec. (d)(3)(H)(i). , substituted “shall separately account for the amounts (hereinafter in this subparagraph referred to as the ‘segregated amounts’)” for “shall segregate in a separate account in the plan or in an escrow account the amounts”.

Pub. L. 99–514, § 1898(c)(2)(B)(ii)Subsec. (d)(3)(H)(ii), (iii). , (iii), substituted “the 18-month period described in clause (v)” for “18 months” and “including any interest” for “plus any interest”.

Pub. L. 99–514, § 1898(c)(2)(B)(iv)Subsec. (d)(3)(H)(iv). , inserted “described in clause (v)”.

Pub. L. 99–514, § 1898(c)(2)(B)(v)Subsec. (d)(3)(H)(v). , added cl. (v).

Pub. L. 99–514, § 1898(c)(4)(B)Subsec. (d)(3)(L). , added subpar. (L) and redesignated former subpar. (L) as (N).

Pub. L. 99–514, § 1898(c)(5)Subsec. (d)(3)(M). , added subpar. (M).

Pub. L. 99–514, § 1898(c)(4)(B)Subsec. (d)(3)(N). , redesignated subpar. (L) as (N).

Pub. L. 98–3971984—Subsec. (d)(3). added par. (3).

Statutory Notes and Related Subsidiaries

Effective Date of 2022 Amendment

section 339(b) of Pub. L. 117–328section 339(c) of Pub. L. 117–328section 414 of Title 26Amendment by applicable to domestic relations orders received by plan administrators after , including any such order which is submitted for reconsideration after such date, see , set out as a note under , Internal Revenue Code.

Effective Date of 2014 Amendment

Pub. L. 113–295section 221(b) of Pub. L. 113–295section 1 of Title 26Amendment by effective , subject to a savings provision, see , set out as a note under , Internal Revenue Code.

Pub. L. 113–159section 2003(c)(3) of Pub. L. 113–159section 436 of Title 26Amendment by applicable to plan years beginning after , except as otherwise provided, see , set out as a note under , Internal Revenue Code.

Pub. L. 113–97section 3 of Pub. L. 113–97section 401 of Title 26Amendment by applicable to years beginning after , see , set out as a note under , Internal Revenue Code.

Effective Date of 2008 Amendment

Pub. L. 110–458Pub. L. 109–280section 112 of Pub. L. 110–458section 72 of Title 26Amendment by effective as if included in the provisions of to which the amendment relates, except as otherwise provided, see , set out as a note under , Internal Revenue Code.

Effective Date of 2006 Amendment

section 103(a) of Pub. L. 109–280section 103(c) of Pub. L. 109–280section 1021 of this titleAmendment by applicable to plan years beginning after , with collective bargaining exception, see , set out as a note under .

Pub. L. 109–280section 108(e) of Pub. L. 109–280section 1021 of this titleAmendment by section 108(a)(9), (10) of applicable to plan years beginning after 2007, see , set out as a note under .

Pub. L. 109–280, title IV, § 410(c)120 Stat. 935

section 1350 of this title29 U.S.C. 1350(c)“The amendments made by this section [amending this section and ] shall apply to distributions made after final regulations implementing subsections (c) and (d) of section 4050 of the Employee Retirement Income Security Act of 1974 [, (d)] (as added by subsection (a)), respectively, are prescribed.”
, , , provided that:

Effective Date of 1997 Amendment

Pub. L. 105–34section 1502(c) of Pub. L. 105–34section 401 of Title 26Amendment by applicable to judgments, orders, and decrees issued, and settlement agreements entered into, on or after , see , set out as a note under , Internal Revenue Code.

Effective Date of 1994 Amendment

Pub. L. 103–465, title VII, § 761(b)108 Stat. 5034

“(1)

In general .—

Except as provided in paragraph (2), the amendments made by this section [amending this section and sections 1082, 1132, and 1301 of this title] shall apply to plan years beginning after .
“(2)

Contributing sponsor .—

section 1301 of this titlePub. L. 100–203, title IXThe amendment made by subsection (a)(11) [amending ] shall be effective as if included in the Pension Protection Act [, subtitle D, part II, §§ 9302–9346].”
, , , provided that:

Pub. L. 103–465, title VII, § 776(e)108 Stat. 5048

section 1350 of this titlesection 401 of Title 26“The provisions of this section [enacting and amending this section and sections 1303, 1305, and 1341 of this title and , Internal Revenue Code] shall be effective with respect to distributions that occur in plan years commencing after final regulations implementing these provisions are prescribed by the Pension Benefit Guaranty Corporation.”
, , , provided that: [Final implementing regulations were issued , effective for distributions in plan years beginning on or after . See 60 F.R. 61740.]

Effective Date of 1989 Amendment

section 7891(a)(1) of Pub. L. 101–239Pub. L. 99–514section 7891(f) of Pub. L. 101–239section 1002 of this titleAmendment by effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, , to which such amendment relates, see , set out as a note under .

section 7894(c)(8) of Pub. L. 101–239Pub. L. 93–406section 7894(i) of Pub. L. 101–239section 1002 of this titleAmendment by effective, except as otherwise provided, as if originally included in the provision of the Employee Retirement Income Security Act of 1974, , to which such amendment relates, see , set out as a note under .

Pub. L. 101–239, title VII, § 7894(c)(9)(B)103 Stat. 2449

Pub. L. 98–397“The amendment made by subparagraph (A) [amending this section] shall take effect as if included in section 104 of the Retirement Equity Act of 1984 [].”
, , , provided that:

Effective Date of 1986 Amendment

Pub. L. 99–514Pub. L. 98–397section 1898(j) of Pub. L. 99–514section 401 of Title 26Amendment by effective as if included in the provision of the Retirement Equity Act of 1984, , to which such amendment relates, except as otherwise provided, see , set out as a note under , Internal Revenue Code.

Effective Date of 1984 Amendment

Pub. L. 98–397section 303(d) of Pub. L. 98–397section 1001 of this titleAmendment by effective , except as otherwise provided, see , set out as a note under .

Pub. L. 109–280Applicability of Amendments by Subtitles A and B of Title I of

Pub. L. 109–280Pub. L. 109–280section 401 of Title 26For special rules on applicability of amendments by subtitles A (§§ 101–108) and B (§§ 111–116) of title I of to certain eligible cooperative plans, PBGC settlement plans, and eligible government contractor plans, see sections 104, 105, and 106 of , set out as notes under , Internal Revenue Code.

Plan Amendments Not Required Until January 1, 1989

Pub. L. 99–514section 1140 of Pub. L. 99–514section 401 of Title 26For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after , see , set out as a note under , Internal Revenue Code.