29 U.S.C. § 1002 — Definitions
submitted 52 years ago by Pub. L. 93-406 to r/title-29-LABOR · 7,783 words · no verdicts yet
This section defines terms used in this subchapter. It identifies the kinds of benefit plans, people, organizations, assets, and calculations covered by those terms, and sets rules for several kinds of plans.
For purposes of this subchapter:
(1) “Employee welfare benefit plan” and “welfare plan” mean any plan, fund, or program that was established in the past or is established in the future, and that is established or maintained by an employer, an employee organization, or both, to provide participants or their beneficiaries, through insurance or otherwise, with:
(A) Medical, surgical, or hospital care or benefits; benefits for sickness, accident, disability, death, or unemployment; vacation benefits; apprenticeship or other training programs; day-care centers; scholarship funds; or prepaid legal services; or
(B) Any benefit described in section 186(c) of this title, except pensions on retirement or death and insurance that provides those pensions.
(2)(A) Except as provided in subparagraph (B), “employee pension benefit plan” and “pension plan” mean any plan, fund, or program that was established in the past or is established in the future, and that is established or maintained by an employer, an employee organization, or both, to the extent that its express terms or the surrounding circumstances show that it:
(i) Provides retirement income to employees; or
(ii) Defers employees’ income until the end of covered employment or later. This definition applies regardless of how contributions, benefits, or benefit distributions are calculated.
A distribution is not treated as something other than retirement income, or as occurring before covered employment ends, only because it is made to an employee who is at least 62 and still employed.
(B) The Secretary may issue regulations consistent with this chapter’s standards and purposes that create exempt categories under which the following are treated as welfare plans rather than pension plans:
(i) Severance-pay arrangements; and
(ii) Supplemental retirement-income payments that increase retirees’ or beneficiaries’ pension benefits to account for some or all of the increase in the cost of living since retirement, as determined by the Secretary of Labor.
An arrangement or payment whose main effect is avoiding the standards or purposes of this chapter that apply to pension plans must be treated as a pension plan. An applicable voluntary early-retirement incentive plan, as defined in section 457(e)(11)(D)(ii) of title 26, that makes payments or supplements described in section 457(e)(11)(D)(i) of title 26, and an applicable employment-retention plan, as defined in section 457(f)(4)(C) of title 26, that makes benefit payments described in section 457(f)(4)(A) of title 26, are treated as welfare plans, not pension plans, for those payments and supplements.
(C) A pooled employer plan is treated as:
(i) One employee pension benefit plan, or one pension plan; and
(ii) A plan to which section 1060(a) of this title applies.
(3) “Employee benefit plan” or “plan” means an employee welfare benefit plan, an employee pension benefit plan, or a plan that is both.
(4) “Employee organization” means a labor union or any other organization, agency, employee-representation committee, association, group, or plan in which employees participate and that exists wholly or partly to deal with employers about an employee benefit plan or matters related to employment relationships. It also means an employees’ beneficiary association organized wholly or partly to establish such a plan.
(5) “Employer” means a person acting directly as an employer, or indirectly in an employer’s interest, in relation to an employee benefit plan. It includes a group or association of employers acting for an employer in that role.
(6) “Employee” means an individual employed by an employer.
(7) “Participant” means an employer’s current or former employee, or a current or former member of an employee organization, who is or may become eligible for any kind of benefit from an employee benefit plan covering that employer’s employees or that organization’s members. It also includes a person whose beneficiaries may be eligible for such a benefit.
(8) “Beneficiary” means a person designated by a participant or by the terms of an employee benefit plan who is or may become entitled to a benefit under the plan.
(9) “Person” means an individual, partnership, joint venture, corporation, mutual company, joint-stock company, trust, estate, unincorporated organization, association, or employee organization.
(10) “State” includes any State of the United States, the District of Columbia, Puerto Rico, the Virgin Islands, American Samoa, Guam, Wake Island, and the Canal Zone. When “United States” is used geographically, it means the States and the Outer Continental Shelf lands defined in the Outer Continental Shelf Lands Act (43 U.S.C. 1331–1343).
(11) “Commerce” means trade, traffic, commerce, transportation, or communication between a State and a place outside that State.
(12) “Industry or activity affecting commerce” means any activity, business, or industry in commerce, or any activity, business, or industry in which a labor dispute would hinder or obstruct commerce or its free flow. It includes any activity or industry “affecting commerce” under the Labor Management Relations Act, 1947 (29 U.S.C. 141 et seq.), or the Railway Labor Act (45 U.S.C. 151 et seq.). This section does not define the quoted term beyond this description.
(13) “Secretary” means the Secretary of Labor.
(14) “Party in interest,” regarding an employee benefit plan, means:
(A) Any fiduciary, including an administrator, officer, trustee, or custodian; counsel; or employee of the plan;
(B) A person providing services to the plan;
(C) An employer whose employees are covered by the plan;
(D) An employee organization whose members are covered by the plan;
(E) A direct or indirect owner of at least 50 percent of:
(i) The combined voting power of all voting stock classes, or the total value of all stock classes, of a corporation that is an employer or employee organization described in (C) or (D);
(ii) The capital interest or profits interest of a partnership that is such an employer or organization; or
(iii) The beneficial interest of a trust or unincorporated enterprise that is such an employer or organization;
(F) A “relative,” as defined in paragraph (15), of an individual described in (A), (B), (C), or (E);
(G) A corporation, partnership, trust, or estate in which at least 50 percent of the relevant ownership or interest is directly or indirectly owned or held by persons described in (A), (B), (C), (D), or (E). The relevant interest is voting power or stock value for a corporation, capital or profits interest for a partnership, and beneficial interest for a trust or estate;
(H) An employee, officer, director, person with similar powers or responsibilities, or shareholder owning at least 10 percent, directly or indirectly, of a person described in (B), (C), (D), (E), or (G), or of the employee benefit plan; or
(I) A partner or joint venturer who directly or indirectly owns at least 10 percent of the capital or profits of a person described in (B), (C), (D), (E), or (G).
After consulting and coordinating with the Secretary of the Treasury, the Secretary may by regulation set a percentage below 50 percent for (E) and (G), and below 10 percent for (H) and (I). The Secretary may also regulate how direct and indirect ownership of profits and beneficial interests is determined and how indirect stock ownership is counted. A person who is a party in interest to a plan that may make payments to a trust described in section 501(c)(22) of title 26 under section 1403 of this title is treated as a party in interest to that trust.
(15) “Relative” means a spouse, ancestor, lineal descendant, or spouse of a lineal descendant.
(16)(A) “Administrator” means:
(i) The person specifically named in the instrument under which the plan operates;
(ii) If no administrator is named, the plan sponsor; or
(iii) If no administrator is named and no plan sponsor can be identified, another person the Secretary specifies by regulation.
(B) “Plan sponsor” means:
(i) The employer, for a plan established or maintained by one employer;
(ii) The employee organization, for a plan established or maintained by an employee organization;
(iii) For a plan established or maintained by two or more employers, or jointly by employers and employee organizations, the association, committee, joint board of trustees, or similar representative group of the parties that establish or maintain the plan; or
(iv) For a pooled employer plan, the pooled plan provider.
(17) “Separate account” means an account an insurance company establishes or maintains under a contract. Income, gains, and losses, whether realized or not, from assets assigned to the account are credited to or charged against that account without regard to the insurance company’s other income, gains, or losses.
(18) “Adequate consideration,” when used in part 4 of subtitle B, means:
(A) For a security with a generally recognized market, either:
(i) The security’s prevailing price on a national securities exchange registered under section 78f of title 15; or
(ii) If the security is not traded on such an exchange, a price no less favorable to the plan than the offering price established by current bid and asked prices quoted by people independent of the issuer and every party in interest; and
(B) For an asset other than a security with a generally recognized market, the asset’s fair market value, determined in good faith by the trustee or named fiduciary* under the plan’s terms and the Secretary’s regulations.
(19) “Nonforfeitable,” for a pension benefit or right, means a participant’s or beneficiary’s unconditional, legally enforceable claim against the plan to the part of an immediate or deferred pension benefit that arises from the participant’s service. A right to an accrued benefit from employer contributions is not forfeitable merely because the plan has a provision described in section 1053(a)(3) of this title.
(20) “Security” has the same meaning as in section 77b(1) of title 15. This section does not define that term separately.
(21)(A) Except as provided in (B), a person is a fiduciary for a plan to the extent that the person:
(i) Exercises discretionary authority or control over the plan’s management, or authority or control over managing or disposing of its assets;
(ii) Gives investment advice for a direct or indirect fee or other compensation about the plan’s money or other property, or has authority or responsibility to do so; or
(iii) Has discretionary authority or responsibility in administering the plan.
The term includes a person designated under section 1105(c)(1)(B) of this title.
(B) If plan money or other property is invested in securities issued by an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), that investment alone does not make the investment company, its investment adviser, or its principal underwriter a fiduciary or party in interest under this subchapter. This exception does not apply when the company, adviser, or underwriter acts in connection with a plan covering its own employees. This subparagraph does not limit duties imposed on any of them by another law.
(22) “Normal retirement benefit” means the greater of the plan’s early-retirement benefit and the plan benefit beginning at normal retirement age. It is determined without counting:
(A) Medical benefits; or
(B) Disability benefits that do not exceed the qualified disability benefit.
A “qualified disability benefit” is a plan disability benefit no greater than the benefit the participant would receive if the participant left service at normal retirement age. The plan’s early-retirement benefit is determined without counting a benefit that the Secretary of the Treasury finds is described in section 1054(b)(1)(G) of this title.
(23) “Accrued benefit” means:
(A) For a defined-benefit plan, the individual’s accrued benefit under the plan, expressed—except as provided in section 1054(c)(3) of this title—as an annual benefit beginning at normal retirement age; or
(B) For an individual-account plan, the balance in the individual’s account.
An employee’s accrued benefit cannot be less than the amount determined under section 1054(c)(2)(B) of this title for the employee’s accumulated contributions.
(24) “Normal retirement age” means the earlier of:
(A) The time when the participant reaches the normal retirement age stated in the plan; or
(B) The later of:
(i) The time when the participant reaches age 65; or
(ii) The fifth anniversary of the participant’s starting participation in the plan.
(25) “Vested liabilities” means the present value, at normal retirement age, of the immediate or deferred benefits available to participants and beneficiaries that are nonforfeitable.
(26) “Current value” means fair market value when available. Otherwise, it means fair value determined in good faith by a trustee or named fiduciary, as defined in section 1102(a)(2) of this title, under the plan’s terms and the Secretary’s regulations, assuming the assets were being orderly liquidated when the value was determined.
(27) “Present value,” for a liability, means its value adjusted to reflect anticipated events. The adjustments must follow regulations the Secretary of the Treasury may issue.
(28) “Normal service cost” or “normal cost” means the annual cost of future pension benefits and administrative expenses assigned, under an actuarial cost method, to years after a particular valuation date of a pension plan. The Secretary of the Treasury may issue regulations to carry out this paragraph.
(29) “Accrued liability” means the excess of two amounts as of a plan’s particular valuation date: first, the present value of projected future benefit costs and administrative expenses for all participants and beneficiaries; minus, second, the present value of future contributions for the normal cost of all applicable participants and beneficiaries. The Secretary of the Treasury may issue regulations to carry out this paragraph.
(30) “Unfunded accrued liability” means the excess of the accrued liability, calculated under an actuarial cost method that provides for it, over the present value of a pension plan’s assets. The Secretary of the Treasury may issue regulations to carry out this paragraph.
(31) “Advance funding actuarial cost method” or “actuarial cost method” means a recognized actuarial technique for establishing the amount and timing of a pension plan’s yearly actuarial costs for benefits and expenses. Acceptable methods include the accrued-benefit cost method (unit-credit method), entry-age normal-cost method, individual-level-premium cost method, aggregate-cost method, attained-age normal-cost method, and frozen-initial-liability cost method. The terminal-funding cost method and current-funding (pay-as-you-go) cost method are not acceptable. The Secretary of the Treasury must issue regulations further defining acceptable methods.
(32) “Governmental plan” means a plan established or maintained for employees by the United States Government, a State or its political subdivision, or an agency or instrumentality of any of them. It also includes a plan to which the Railroad Retirement Act of 1935 or 1937 (45 U.S.C. 231 et seq.) applies and that is financed by required contributions under that Act, and a plan of an international organization exempt from tax under the International Organizations Immunities Act (22 U.S.C. 288 et seq.). It also includes a plan established and maintained by an Indian tribal government, a subdivision of one, or an agency or instrumentality of either, as those terms are described in the cited provisions of title 26, if all participants are employees of that entity and substantially all their services perform essential governmental functions rather than commercial activities, whether or not those activities are an essential government function.
(33)(A) “Church plan” means a plan established and maintained, to the extent required by (B)(ii), for employees or their beneficiaries by a church or a convention or association of churches exempt from tax under section 501 of title 26.
(B) “Church plan” does not include a plan:
(i) Established and maintained mainly for employees or beneficiaries of the church or church group who work in one or more unrelated trades or businesses, as described in section 513 of title 26; or
(ii) If fewer than substantially all of the individuals included in the plan are individuals described in (A) or (C)(ii), or are beneficiaries of those individuals.
(C) For this paragraph:
(i) A church plan includes a plan maintained by an organization, whether a civil-law corporation or otherwise, whose main purpose or function is administering or funding retirement or welfare benefits, or both, for church employees, if the organization is controlled by or associated with a church or church group.
(ii) “Employee of a church or church group” includes: (I) a duly ordained, commissioned, or licensed church minister acting in the ministry, regardless of who pays the minister; (II) an employee of an organization exempt from tax under section 501 of title 26 that is controlled by or associated with a church or church group; and (III) an individual described in clause (v).
(iii) The tax-exempt church or church group is treated as the employer of anyone included as an employee under (ii).
(iv) An organization is “associated with” a church or church group if it shares common religious bonds and convictions with it.
(v) If an employee covered by a church plan leaves service with a church, church group, or tax-exempt organization controlled by or associated with one, the plan still meets this paragraph merely because it retains the employee’s accrued benefit or account for payment under the plan, or receives contributions for the employee for five years after separation. The five-year limit does not apply if the employee is disabled at separation under the plan’s disability rules or, if it has none, under section 72(m)(7) of title 26.
(D)(i) If a church plan fails one or more requirements of this paragraph but corrects the failure within the correction period, it is treated as meeting the requirements for the correction year and all earlier years.
(ii) If it does not correct the failure during that period, it is treated as not meeting the requirements beginning on the date of the earliest failure.
(iii) “Correction period” means whichever ends latest: (I) 270 days after the Secretary of the Treasury mails a default notice; (II) a period set by a competent court after a final determination that the plan fails, or, if the court sets no period, a reasonable period set by the Secretary of the Treasury based on all facts and circumstances, but never less than 270 days after the determination becomes final; or (III) any additional period the Secretary of the Treasury finds reasonable or necessary to correct the default.
(34) “Individual account plan” or “defined contribution plan” means a pension plan with an individual account for each participant and benefits based only on contributions to that account, income, expenses, gains and losses, and forfeitures from other participants’ accounts that may be allocated to it.
(35) “Defined benefit plan” means a pension plan that is not an individual-account plan. However, a pension plan that is not an individual-account plan and provides an employer-contribution benefit partly based on a participant’s separate-account balance is treated as an individual-account plan for section 1052. For paragraph (23) of this section and section 1054, it is treated as an individual-account plan to the extent benefits are based on that separate account, and as a defined-benefit plan for the rest of the benefits.
(36) “Excess benefit plan” means a plan an employer maintains solely to provide certain employees benefits above the contribution and benefit limits in section 415 of title 26, whether or not the plan is funded. A separable part of an employer’s plan maintained for that purpose, as determined by the Secretary of Labor, is treated as a separate excess-benefit plan.
(37)(A) “Multiemployer plan” means a plan:
(i) To which more than one employer must contribute;
(ii) Maintained under one or more collective-bargaining agreements between one or more employee organizations and more than one employer; and
(iii) Meeting other requirements the Secretary prescribes by regulation.
(B) Trades or businesses under common control, whether incorporated or not, are treated as one employer under section 1301(b)(1) of this title.
(C) Despite (A), a plan remains a multiemployer plan on and after its termination date if it was one for the plan year before termination.
(D) For this subchapter, for any plan year beginning before September 26, 1980, “multiemployer plan” means a plan described by this paragraph as it existed immediately before that date.
(E) Within one year after September 26, 1980, a multiemployer plan could irrevocably elect, under the corporation’s procedures and subject to sections 1453(b) and (c) of this title, not to be treated as a multiemployer plan under this chapter or the Internal Revenue Code of 1954 if, for each of the three plan years ending before the effective date of the Multiemployer Pension Plan Amendments Act of 1980: (i) it was not a multiemployer plan because it did not meet (A)(iii) and the corresponding title 26 provision as then in effect; and (ii) it had identified itself as not a multiemployer plan in substantially all filings with the corporation, the Secretary of Labor, and the Secretary of the Treasury.
(F)(i) For this subchapter, a qualified football coaches plan is treated as a multiemployer plan to the extent consistent with this subparagraph, and, despite section 401(k)(4)(B) of title 26, may include a qualified cash-or-deferred arrangement.
(ii) “Qualified football coaches plan” means a defined-contribution plan established and maintained by an organization that: (I) is described in section 501(c) of title 26; (II) has only members who primarily coach football full time at four-year colleges or universities described in section 170(b)(1)(A)(ii) of title 26; and (III) existed on September 18, 1986.
(G)(i) Within one year after August 17, 2006, under Pension Benefit Guaranty Corporation procedures: (I) an election under (E) could be revoked if, for each of the three preceding plan years, the plan would have been a multiemployer plan without that election; and (II) a plan meeting (A)(i) and (ii), or described in (vi), could elect to be a multiemployer plan if, for each of the three plan years before the first effective year, it met those criteria or description, substantially all employer contributions in those years were made or required by tax-exempt section 501 organizations, and it was established before September 2, 1974.
(ii) Such an election is effective for all purposes under this chapter and title 26, beginning with a designated plan year on or after January 1, 1999, and before January 1, 2008.
(iii) The election is irrevocable. But a plan described in (i)(II) stops being a multiemployer plan beginning with the plan year after the first year in which most employer contributions were made or required by organizations not exempt under section 501 of title 26.
(iv) Making the election does not imply that the plan was not a multiemployer plan before the election or would not be one without it.
(v)(I) At least 30 days before the election, the administrator must notify every participant and beneficiary, labor organization representing them, and employer required to contribute. The notice must describe the main differences between the guarantee programs under subchapter III and the benefit limits under this subchapter for single-employer and multiemployer plans, plus other information the administrator chooses. (II) Within 180 days after August 17, 2006, the Secretary must prescribe a model notice. (III) Failure to give the notice is treated, for section 1132(c)(2), as failure or refusal to file the annual report required by section 1021(b)(1).
(vi) This clause describes a plan sponsored by an organization described in section 501(c)(5) of title 26, exempt under section 501(a), and established in Chicago, Illinois, on August 12, 1881.
(vii) For this chapter and title 26, a plan making the election is treated as maintained under a collective-bargaining agreement if such an agreement, expressly or otherwise, provides for or permits employer contributions by a signatory employer or participation by its employees, even if another document created, established, or maintained the plan.
(38) “Investment manager” means a fiduciary other than a trustee or named fiduciary, as defined in section 1102(a)(2), who:
(A) Has power to manage, acquire, or dispose of a plan asset;
(B) Is: (i) registered as an investment adviser under the Investment Advisers Act of 1940; (ii) exempt from that registration under section 203A(a)(1) of that Act, registered under the relevant State law, and has filed its latest State registration form with the Secretary; (iii) a bank as defined in that Act; or (iv) an insurance company qualified under the laws of more than one State to perform the services in (A); and
(C) Has acknowledged in writing being a fiduciary for the plan.
(39) “Plan year” and “fiscal year of the plan” mean the calendar, policy, or fiscal year on which the plan keeps its records.
(40)(A) “Multiple employer welfare arrangement” means an employee welfare benefit plan, or another arrangement, established or maintained to offer or provide a benefit described in paragraph (1) to employees of two or more employers, including self-employed individuals, or their beneficiaries. It does not include such a plan or arrangement established or maintained under agreements the Secretary finds are collective-bargaining agreements, by a rural electric cooperative, or by a rural telephone cooperative association.
(B) For this paragraph:
(i) Trades or businesses under the same control group are treated as one employer, whether incorporated or not;
(ii) “Control group” means trades or businesses under common control;
(iii) Regulations of the Secretary determine common control by applying principles similar to those used under section 1301(b) to decide whether employees of two or more businesses are treated as employed by one employer. Common control cannot be based on an interest below 25 percent;
(iv) “Rural electric cooperative” means: (I) an organization exempt under section 501(a) of title 26 that primarily provides electric service mutually or cooperatively; and (II) an organization described in section 501(c)(4) or (6), exempt under section 501(a), at least 80 percent of whose members are organizations described in (I); and
(v) “Rural telephone cooperative association” means an organization described in section 501(c)(4) or (6), exempt under section 501(a), at least 80 percent of whose members primarily provide telephone service to rural United States areas on a mutual, cooperative, or other basis.
(41) “Single-employer plan” means an employee benefit plan that is not a multiemployer plan.
(42) “Plan assets” means plan assets as defined by the Secretary’s regulations. Under those regulations, an entity’s assets are not plan assets if, immediately after its most recent acquisition of an equity interest, benefit-plan investors hold less than 25 percent of the total value of each equity-interest class. In calculating that 25-percent threshold, disregard equity interests held by anyone other than a benefit-plan investor who has discretionary authority or control over the entity’s assets, anyone who gives paid investment advice about those assets, or an affiliate of such a person. An entity is treated as holding plan assets only in the proportion of its equity interest held by benefit-plan investors. “Benefit plan investor” means an employee benefit plan subject to part 4, a plan to which section 4975 of title 26 applies, or an entity whose underlying assets include plan assets because a plan invested in the entity.
(43)(A) “Pooled employer plan” means a plan that:
(i) Is an individual-account plan established or maintained to provide benefits to employees of at least two employers;
(ii) Is a plan described in section 401(a) of title 26 with a tax-exempt section 501(a) trust, a plan consisting of section 403(b) annuity contracts, or a plan consisting of section 408 individual retirement accounts, including under subsection (c); and
(iii) Has terms meeting (B).
It does not include a plan maintained by employers with a common interest other than adopting the plan. But it includes a plan, except one excluded by section 1003(b)(2), for employees of more than one employer that consists of section 403(b) annuity contracts and meets section 413(e)(1)(B) of title 26.
(B) A plan’s terms meet the requirements if they:
(i) Name a pooled plan provider and make that provider a named fiduciary;
(ii) Name a fiduciary other than an employer to collect contributions and require written procedures that are reasonable, diligent, and systematic;
(iii) Keep each employer responsible as a fiduciary for: (I) selecting and monitoring, under section 1104(a), the pooled plan provider and every other named fiduciary besides that provider; and (II) unless the provider delegates it to another fiduciary and subject to section 1104(c), investing and managing the part of plan assets attributable to that employer’s employees or their beneficiaries;
(iv) Ensure employers, participants, and beneficiaries face no unreasonable restriction, fee, or penalty for ending participation, receiving distributions, or transferring assets under section 1058 or paragraph (44)(C)(i)(II);
(v) Require: (I) the provider to give employers disclosures or other information the Secretary requires, including information to help employers select or monitor the provider; and (II) each employer to take actions the Secretary or provider finds necessary to administer the plan or meet applicable requirements under this chapter or title 26 for the applicable type of plan, including providing required information; and
(vi) Provide that required disclosures or information may be electronic and will be designed to impose only reasonable costs on providers and employers.
(C) “Pooled employer plan” does not include a multiemployer plan or a plan established before December 20, 2019, unless the administrator elects pooled-plan treatment and the plan meets this subchapter’s requirements for a pooled employer plan established on or after that date.
(D) Except for the provider’s administrative duties under paragraph (44)(A)(i), each employer is treated as plan sponsor for the portion attributable to its employees or their beneficiaries.
(44)(A) “Pooled plan provider” means a person who:
(i) The pooled employer plan designates as named fiduciary, plan administrator, and responsible for all reasonably necessary administrative duties, including proper testing for the plan and each employer’s employees, to ensure that the plan meets the applicable requirements of this chapter or title 26 for the relevant plan type and that each employer takes required actions, including providing the information described in (43)(B)(v)(II);
(ii) Registers with the Secretary as a pooled plan provider and gives the Secretary other required information before beginning operations;
(iii) Acknowledges in writing being the plan’s named fiduciary and administrator; and
(iv) Ensures that everyone handling plan assets or serving as a plan fiduciary is bonded under section 1112.
(B) The Secretary may audit, examine, and investigate pooled plan providers as necessary to enforce and carry out paragraphs (43) and (44).
(C) The Secretary must issue suitable guidance for paragraphs (43) and (44), including guidance:
(i) Identifying the provider’s required administrative duties and other actions; and
(ii) In appropriate cases, requiring that if an employer fails to take actions required under (A)(i)(II), the assets attributable to that employer’s employees or beneficiaries be transferred to a plan maintained only by that employer or successor, to an eligible retirement plan under section 402(c)(8)(B) of title 26 for each person whose account is transferred, or to another arrangement the guidance approves. The guidance may also make that employer, rather than the affected plan or another employer in it, liable for liabilities attributable to that employer’s employees or beneficiaries, except as the guidance provides.
In deciding under (ii), the Secretary must consider whether the failure to provide information or take another necessary action continued long enough to show a lack of commitment to compliance. The Secretary may waive the transfer requirement when keeping the assets in the plan is in the best interests of the employer’s employees and beneficiaries.
(D) An employer or provider is not treated as failing to meet guidance issued under (C) if, before the guidance was issued, it acted in good faith based on a reasonable interpretation of the related provisions of this paragraph or paragraph (43).
(E) To decide whether a person qualifies as a provider, all persons performing services for the plan who are treated as one employer under section 414(b), (c), (m), or (o) of title 26 are treated as one person.
(45) “Pension-linked emergency savings account” means a short-term savings account established and maintained as part of an individual-account plan under section 1193 of this title for an eligible participant, as defined in section 1193(b), that:
(A) Is a designated Roth account under section 402A of title 26, accepts only participant contributions described in section 1193(d)(1)(A), and those contributions are designated Roth contributions subject to section 402A(e) of title 26; and
(B) Meets the requirements of part 8 of subtitle B.
For purposes of this subchapter:
The terms “employee welfare benefit plan” and “welfare plan” mean any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, disability, death or unemployment, or vacation benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services, or (B) any benefit described in section 186(c) of this title (other than pensions on retirement or death, and insurance to provide such pensions).
Except as provided in subparagraph (B), the terms “employee pension benefit plan” and “pension plan” mean any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that by its express terms or as a result of surrounding circumstances such plan, fund, or program—
provides retirement income to employees, or
results in a deferral of income by employees for periods extending to the termination of covered employment or beyond,
regardless of the method of calculating the contributions made to the plan, the method of calculating the benefits under the plan or the method of distributing benefits from the plan. A distribution from a plan, fund, or program shall not be treated as made in a form other than retirement income or as a distribution prior to termination of covered employment solely because such distribution is made to an employee who has attained age 62 and who is not separated from employment at the time of such distribution.
The Secretary may by regulation prescribe rules consistent with the standards and purposes of this chapter providing one or more exempt categories under which—
severance pay arrangements, and
supplemental retirement income payments, under which the pension benefits of retirees or their beneficiaries are supplemented to take into account some portion or all of the increases in the cost of living (as determined by the Secretary of Labor) since retirement,
shall, for purposes of this subchapter, be treated as welfare plans rather than pension plans. In the case of any arrangement or payment a principal effect of which is the evasion of the standards or purposes of this chapter applicable to pension plans, such arrangement or payment shall be treated as a pension plan. An applicable voluntary early retirement incentive plan (as defined in section 457(e)(11)(D)(ii) of title 26) making payments or supplements described in section 457(e)(11)(D)(i) of title 26, and an applicable employment retention plan (as defined in section 457(f)(4)(C) of title 26) making payments of benefits described in section 457(f)(4)(A) of title 26, shall, for purposes of this subchapter, be treated as a welfare plan (and not a pension plan) with respect to such payments and supplements.
A pooled employer plan shall be treated as—
a single employee pension benefit plan or single pension plan; and
a plan to which section 1060(a) of this title applies.
The term “employee benefit plan” or “plan” means an employee welfare benefit plan or an employee pension benefit plan or a plan which is both an employee welfare benefit plan and an employee pension benefit plan.
The term “employee organization” means any labor union or any organization of any kind, or any agency or employee representation committee, association, group, or plan, in which employees participate and which exists for the purpose, in whole or in part, of dealing with employers concerning an employee benefit plan, or other matters incidental to employment relationships; or any employees’ beneficiary association organized for the purpose in whole or in part, of establishing such a plan.
The term “employer” means any person acting directly as an employer, or indirectly in the interest of an employer, in relation to an employee benefit plan; and includes a group or association of employers acting for an employer in such capacity.
The term “employee” means any individual employed by an employer.
The term “participant” means any employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer or members of such organization, or whose beneficiaries may be eligible to receive any such benefit.
The term “beneficiary” means a person designated by a participant, or by the terms of an employee benefit plan, who is or may become entitled to a benefit thereunder.
The term “person” means an individual, partnership, joint venture, corporation, mutual company, joint-stock company, trust, estate, unincorporated organization, association, or employee organization.
The term “State” includes any State of the United States, the District of Columbia, Puerto Rico, the Virgin Islands, American Samoa, Guam, Wake Island, and the Canal Zone. The term “United States” when used in the geographic sense means the States and the Outer Continental Shelf lands defined in the Outer Continental Shelf Lands Act (43 U.S.C. 1331–1343).
The term “commerce” means trade, traffic, commerce, transportation, or communication between any State and any place outside thereof.
The term “industry or activity affecting commerce” means any activity, business, or industry in commerce or in which a labor dispute would hinder or obstruct commerce or the free flow of commerce, and includes any activity or industry “affecting commerce” within the meaning of the Labor Management Relations Act, 1947 [29 U.S.C. 141 et seq.], or the Railway Labor Act [45 U.S.C. 151 et seq.].
The term “Secretary” means the Secretary of Labor.
The term “party in interest” means, as to an employee benefit plan—
any fiduciary (including, but not limited to, any administrator, officer, trustee, or custodian), counsel, or employee of such employee benefit plan;
a person providing services to such plan;
an employer any of whose employees are covered by such plan;
an employee organization any of whose members are covered by such plan;
an owner, direct or indirect, of 50 percent or more of—
the combined voting power of all classes of stock entitled to vote or the total value of shares of all classes of stock of a corporation.1
the capital interest or the profits interest of a partnership, or
the beneficial interest of a trust or unincorporated enterprise,
which is an employer or an employee organization described in subparagraph (C) or (D);
a relative (as defined in paragraph (15)) of any individual described in subparagraph (A), (B), (C), or (E);
a corporation, partnership, or trust or estate of which (or in which) 50 percent or more of—
the combined voting power of all classes of stock entitled to vote or the total value of shares of all classes of stock of such corporation,
the capital interest or profits interest of such partnership, or
the beneficial interest of such trust or estate,
is owned directly or indirectly, or held by persons described in subparagraph (A), (B), (C), (D), or (E);
an employee, officer, director (or an individual having powers or responsibilities similar to those of officers or directors), or a 10 percent or more shareholder directly or indirectly, of a person described in subparagraph (B), (C), (D), (E), or (G), or of the employee benefit plan; or
a 10 percent or more (directly or indirectly in capital or profits) partner or joint venturer of a person described in subparagraph (B), (C), (D), (E), or (G).
The Secretary, after consultation and coordination with the Secretary of the Treasury, may by regulation prescribe a percentage lower than 50 percent for subparagraph (E) and (G) and lower than 10 percent for subparagraph (H) or (I). The Secretary may prescribe regulations for determining the ownership (direct or indirect) of profits and beneficial interests, and the manner in which indirect stockholdings are taken into account. Any person who is a party in interest with respect to a plan to which a trust described in section 501(c)(22) of title 26 is permitted to make payments under section 1403 of this title shall be treated as a party in interest with respect to such trust.
The term “relative” means a spouse, ancestor, lineal descendant, or spouse of a lineal descendant.
The term “administrator” means—
the person specifically so designated by the terms of the instrument under which the plan is operated;
if an administrator is not so designated, the plan sponsor; or
in the case of a plan for which an administrator is not designated and a plan sponsor cannot be identified, such other person as the Secretary may by regulation prescribe.
The term “plan sponsor” means (i) the employer in the case of an employee benefit plan established or maintained by a single employer, (ii) the employee organization in the case of a plan established or maintained by an employee organization, (iii) in the case of a plan established or maintained by two or more employers or jointly by one or more employers and one or more employee organizations, the association, committee, joint board of trustees, or other similar group of representatives of the parties who establish or maintain the plan, or (iv) in the case of a pooled employer plan, the pooled plan provider.
The term “separate account” means an account established or maintained by an insurance company under which income, gains, and losses, whether or not realized, from assets allocated to such account, are, in accordance with the applicable contract, credited to or charged against such account without regard to other income, gains, or losses of the insurance company.
The term “adequate consideration” when used in part 4 of subtitle B means (A) in the case of a security for which there is a generally recognized market, either (i) the price of the security prevailing on a national securities exchange which is registered under section 78f of title 15, or (ii) if the security is not traded on such a national securities exchange, a price not less favorable to the plan than the offering price for the security as established by the current bid and asked prices quoted by persons independent of the issuer and of any party in interest; and (B) in the case of an asset other than a security for which there is a generally recognized market, the fair market value of the asset as determined in good faith by the trustee or named fiduciary* pursuant to the terms of the plan and in accordance with regulations promulgated by the Secretary.
The term “nonforfeitable” when used with respect to a pension benefit or right means a claim obtained by a participant or his beneficiary to that part of an immediate or deferred benefit under a pension plan which arises from the participant’s service, which is unconditional, and which is legally enforceable against the plan. For purposes of this paragraph, a right to an accrued benefit derived from employer contributions shall not be treated as forfeitable merely because the plan contains a provision described in section 1053(a)(3) of this title.
The term “security” has the same meaning as such term has under section 77b(1) 2 of title 15.
Except as otherwise provided in subparagraph (B), a person is a fiduciary with respect to a plan to the extent (i) he exercises any discretionary authority or discretionary control respecting management of such plan or exercises any authority or control respecting management or disposition of its assets, (ii) he renders investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan, or has any authority or responsibility to do so, or (iii) he has any discretionary authority or discretionary responsibility in the administration of such plan. Such term includes any person designated under section 1105(c)(1)(B) of this title.
If any money or other property of an employee benefit plan is invested in securities issued by an investment company registered under the Investment Company Act of 1940 [15 U.S.C. 80a–1 et seq.], such investment shall not by itself cause such investment company or such investment company’s investment adviser or principal underwriter to be deemed to be a fiduciary or a party in interest as those terms are defined in this subchapter, except insofar as such investment company or its investment adviser or principal underwriter acts in connection with an employee benefit plan covering employees of the investment company, the investment adviser, or its principal underwriter. Nothing contained in this subparagraph shall limit the duties imposed on such investment company, investment adviser, or principal underwriter by any other law.
The term “normal retirement benefit” means the greater of the early retirement benefit under the plan, or the benefit under the plan commencing at normal retirement age. The normal retirement benefit shall be determined without regard to—
medical benefits, and
disability benefits not in excess of the qualified disability benefit.
For purposes of this paragraph, a qualified disability benefit is a disability benefit provided by a plan which does not exceed the benefit which would be provided for the participant if he separated from the service at normal retirement age. For purposes of this paragraph, the early retirement benefit under a plan shall be determined without regard to any benefit under the plan which the Secretary of the Treasury finds to be a benefit described in section 1054(b)(1)(G) of this title.
The term “accrued benefit” means—
in the case of a defined benefit plan, the individual’s accrued benefit determined under the plan and, except as provided in section 1054(c)(3) of this title, expressed in the form of an annual benefit commencing at normal retirement age, or
in the case of a plan which is an individual account plan, the balance of the individual’s account.
The accrued benefit of an employee shall not be less than the amount determined under section 1054(c)(2)(B) of this title with respect to the employee’s accumulated contribution.
The term “normal retirement age” means the earlier of—
the time a plan participant attains normal retirement age under the plan, or
the later of—
the time a plan participant attains age 65, or
the 5th anniversary of the time a plan participant commenced participation in the plan.
The term “vested liabilities” means the present value of the immediate or deferred benefits available at normal retirement age for participants and their beneficiaries which are nonforfeitable.
The term “current value” means fair market value where available and otherwise the fair value as determined in good faith by a trustee or a named fiduciary (as defined in section 1102(a)(2) of this title) pursuant to the terms of the plan and in accordance with regulations of the Secretary, assuming an orderly liquidation at the time of such determination.
The term “present value”, with respect to a liability, means the value adjusted to reflect anticipated events. Such adjustments shall conform to such regulations as the Secretary of the Treasury may prescribe.
The term “normal service cost” or “normal cost” means the annual cost of future pension benefits and administrative expenses assigned, under an actuarial cost method, to years subsequent to a particular valuation date of a pension plan. The Secretary of the Treasury may prescribe regulations to carry out this paragraph.
The term “accrued liability” means the excess of the present value, as of a particular valuation date of a pension plan, of the projected future benefit costs and administrative expenses for all plan participants and beneficiaries over the present value of future contributions for the normal cost of all applicable plan participants and beneficiaries. The Secretary of the Treasury may prescribe regulations to carry out this paragraph.
The term “unfunded accrued liability” means the excess of the accrued liability, under an actuarial cost method which so provides, over the present value of the assets of a pension plan. The Secretary of the Treasury may prescribe regulations to carry out this paragraph.
The term “advance funding actuarial cost method” or “actuarial cost method” means a recognized actuarial technique utilized for establishing the amount and incidence of the annual actuarial cost of pension plan benefits and expenses. Acceptable actuarial cost methods shall include the accrued benefit cost method (unit credit method), the entry age normal cost method, the individual level premium cost method, the aggregate cost method, the attained age normal cost method, and the frozen initial liability cost method. The terminal funding cost method and the current funding (pay-as-you-go) cost method are not acceptable actuarial cost methods. The Secretary of the Treasury shall issue regulations to further define acceptable actuarial cost methods.
The term “governmental plan” means a plan established or maintained for its employees by the Government of the United States, by the government of any State or political subdivision thereof, or by any agency or instrumentality of any of the foregoing. The term “governmental plan” also includes any plan to which the Railroad Retirement Act of 1935, or 1937 [45 U.S.C. 231 et seq.] applies, and which is financed by contributions required under that Act and any plan of an international organization which is exempt from taxation under the provisions of the International Organizations Immunities Act [22 U.S.C. 288 et seq.]. The term “governmental plan” includes a plan which is established and maintained by an Indian tribal government (as defined in section 7701(a)(40) of title 26), a subdivision of an Indian tribal government (determined in accordance with section 7871(d) of title 26), or an agency or instrumentality of either, and all of the participants of which are employees of such entity substantially all of whose services as such an employee are in the performance of essential governmental functions but not in the performance of commercial activities (whether or not an essential government function) 3
The term “church plan” means a plan established and maintained (to the extent required in clause (ii) of subparagraph (B)) for its employees (or their beneficiaries) by a church or by a convention or association of churches which is exempt from tax under section 501 of title 26.
The term “church plan” does not include a plan—
which is established and maintained primarily for the benefit of employees (or their beneficiaries) of such church or convention or association of churches who are employed in connection with one or more unrelated trades or businesses (within the meaning of section 513 of title 26), or
if less than substantially all of the individuals included in the plan are individuals described in subparagraph (A) or in clause (ii) of subparagraph (C) (or their beneficiaries).
For purposes of this paragraph—
A plan established and maintained for its employees (or their beneficiaries) by a church or by a convention or association of churches includes a plan maintained by an organization, whether a civil law corporation or otherwise, the principal purpose or function of which is the administration or funding of a plan or program for the provision of retirement benefits or welfare benefits, or both, for the employees of a church or a convention or association of churches, if such organization is controlled by or associated with a church or a convention or association of churches.
The term employee of a church or a convention or association of churches includes—
a duly ordained, commissioned, or licensed minister of a church in the exercise of his ministry, regardless of the source of his compensation;
an employee of an organization, whether a civil law corporation or otherwise, which is exempt from tax under section 501 of title 26 and which is controlled by or associated with a church or a convention or association of churches; and
an individual described in clause (v).
A church or a convention or association of churches which is exempt from tax under section 501 of title 26 shall be deemed the employer of any individual included as an employee under clause (ii).
An organization, whether a civil law corporation or otherwise, is associated with a church or a convention or association of churches if it shares common religious bonds and convictions with that church or convention or association of churches.
If an employee who is included in a church plan separates from the service of a church or a convention or association of churches or an organization, whether a civil law corporation or otherwise, which is exempt from tax under section 501 of title 26 and which is controlled by or associated with a church or a convention or association of churches, the church plan shall not fail to meet the requirements of this paragraph merely because the plan—
retains the employee’s accrued benefit or account for the payment of benefits to the employee or his beneficiaries pursuant to the terms of the plan; or
receives contributions on the employee’s behalf after the employee’s separation from such service, but only for a period of 5 years after such separation, unless the employee is disabled (within the meaning of the disability provisions of the church plan or, if there are no such provisions in the church plan, within the meaning of section 72(m)(7) of title 26) at the time of such separation from service.
If a plan established and maintained for its employees (or their beneficiaries) by a church or by a convention or association of churches which is exempt from tax under section 501 of title 26 fails to meet one or more of the requirements of this paragraph and corrects its failure to meet such requirements within the correction period, the plan shall be deemed to meet the requirements of this paragraph for the year in which the correction was made and for all prior years.
If a correction is not made within the correction period, the plan shall be deemed not to meet the requirements of this paragraph beginning with the date on which the earliest failure to meet one or more of such requirements occurred.
For purposes of this subparagraph, the term “correction period” means—
the period ending 270 days after the date of mailing by the Secretary of the Treasury of a notice of default with respect to the plan’s failure to meet one or more of the requirements of this paragraph; or
any period set by a court of competent jurisdiction after a final determination that the plan fails to meet such requirements, or, if the court does not specify such period, any reasonable period determined by the Secretary of the Treasury on the basis of all the facts and circumstances, but in any event not less than 270 days after the determination has become final; or
any additional period which the Secretary of the Treasury determines is reasonable or necessary for the correction of the default,
whichever has the latest ending date.
The term “individual account plan” or “defined contribution plan” means a pension plan which provides for an individual account for each participant and for benefits based solely upon the amount contributed to the participant’s account, and any income, expenses, gains and losses, and any forfeitures of accounts of other participants which may be allocated to such participant’s account.
The term “defined benefit plan” means a pension plan other than an individual account plan; except that a pension plan which is not an individual account plan and which provides a benefit derived from employer contributions which is based partly on the balance of the separate account of a participant—
for the purposes of section 1052 of this title, shall be treated as an individual account plan, and
for the purposes of paragraph (23) of this section and section 1054 of this title, shall be treated as an individual account plan to the extent benefits are based upon the separate account of a participant and as a defined benefit plan with respect to the remaining portion of benefits under the plan.
The term “excess benefit plan” means a plan maintained by an employer solely for the purpose of providing benefits for certain employees in excess of the limitations on contributions and benefits imposed by section 415 of title 26 on plans to which that section applies without regard to whether the plan is funded. To the extent that a separable part of a plan (as determined by the Secretary of Labor) maintained by an employer is maintained for such purpose, that part shall be treated as a separate plan which is an excess benefit plan.
The term “multiemployer plan” means a plan—
to which more than one employer is required to contribute,
which is maintained pursuant to one or more collective bargaining agreements between one or more employee organizations and more than one employer, and
which satisfies such other requirements as the Secretary may prescribe by regulation.
For purposes of this paragraph, all trades or businesses (whether or not incorporated) which are under common control within the meaning of section 1301(b)(1) of this title are considered a single employer.
Notwithstanding subparagraph (A), a plan is a multiemployer plan on and after its termination date if the plan was a multiemployer plan under this paragraph for the plan year preceding its termination date.
For purposes of this subchapter, notwithstanding the preceding provisions of this paragraph, for any plan year which began before September 26, 1980, the term “multiemployer plan” means a plan described in this paragraph (37) as in effect immediately before such date.
Within one year after September 26, 1980, a multiemployer plan may irrevocably elect, pursuant to procedures established by the corporation and subject to the provisions of sections 1453(b) and (c) of this title, that the plan shall not be treated as a multiemployer plan for all purposes under this chapter or the Internal Revenue Code of 1954 if for each of the last 3 plan years ending prior to the effective date of the Multiemployer Pension Plan Amendments Act of 1980—
the plan was not a multiemployer plan because the plan was not a plan described in subparagraph (A)(iii) of this paragraph and section 414(f)(1)(C) of title 26 (as such provisions were in effect on the day before September 26, 1980); and
the plan had been identified as a plan that was not a multiemployer plan in substantially all its filings with the corporation, the Secretary of Labor and the Secretary of the Treasury.
For purposes of this subchapter a qualified football coaches plan—
shall be treated as a multiemployer plan to the extent not inconsistent with the purposes of this subparagraph; and
notwithstanding section 401(k)(4)(B) of title 26, may include a qualified cash and deferred arrangement.
For purposes of this subparagraph, the term “qualified football coaches plan” means any defined contribution plan which is established and maintained by an organization—
which is described in section 501(c) of title 26;
the membership of which consists entirely of individuals who primarily coach football as full-time employees of 4-year colleges or universities described in section 170(b)(1)(A)(ii) of title 26; and
which was in existence on September 18, 1986.
Within 1 year after August 17, 2006—
an election under subparagraph (E) may be revoked, pursuant to procedures prescribed by the Pension Benefit Guaranty Corporation, if, for each of the 3 plan years prior to August 17, 2006, the plan would have been a multiemployer plan but for the election under subparagraph (E), and
a plan that meets the criteria in clauses (i) and (ii) of subparagraph (A) of this paragraph or that is described in clause (vi) may, pursuant to procedures prescribed by the Pension Benefit Guaranty Corporation, elect to be a multiemployer plan, if—
for each of the 3 plan years immediately preceding the first plan year for which the election under this paragraph is effective with respect to the plan, the plan has met those criteria or is so described,
substantially all of the plan’s employer contributions for each of those plan years were made or required to be made by organizations that were exempt from tax under section 501 of title 26, and
the plan was established prior to September 2, 1974.
An election under this subparagraph shall be effective for all purposes under this chapter and under title 26, starting with any plan year beginning on or after January 1, 1999, and ending before January 1, 2008, as designated by the plan in the election made under clause (i)(II).
Once made, an election under this subparagraph shall be irrevocable, except that a plan described in clause (i)(II) shall cease to be a multiemployer plan as of the plan year beginning immediately after the first plan year for which the majority of its employer contributions were made or required to be made by organizations that were not exempt from tax under section 501 of title 26.
The fact that a plan makes an election under clause (i)(II) does not imply that the plan was not a multiemployer plan prior to the date of the election or would not be a multiemployer plan without regard to the election.
No later than 30 days before an election is made under this subparagraph, the plan administrator shall provide notice of the pending election to each plan participant and beneficiary, each labor organization representing such participants or beneficiaries, and each employer that has an obligation to contribute to the plan, describing the principal differences between the guarantee programs under subchapter III and the benefit restrictions under this subchapter for single employer and multiemployer plans, along with such other information as the plan administrator chooses to include.
Within 180 days after August 17, 2006, the Secretary shall prescribe a model notice under this clause.
A plan administrator’s failure to provide the notice required under this subparagraph shall be treated for purposes of section 1132(c)(2) of this title as a failure or refusal by the plan administrator to file the annual report required to be filed with the Secretary under section 1021(b)(1) of this title.
A plan is described in this clause if it is a plan sponsored by an organization which is described in section 501(c)(5) of title 26 and exempt from tax under section 501(a) of such title and which was established in Chicago, Illinois, on August 12, 1881.
For purposes of this chapter and title 26, a plan making an election under this subparagraph shall be treated as maintained pursuant to a collective bargaining agreement if a collective bargaining agreement, expressly or otherwise, provides for or permits employer contributions to the plan by one or more employers that are signatory to such agreement, or participation in the plan by one or more employees of an employer that is signatory to such agreement, regardless of whether the plan was created, established, or maintained for such employees by virtue of another document that is not a collective bargaining agreement.
The term “investment manager” means any fiduciary (other than a trustee or named fiduciary, as defined in section 1102(a)(2) of this title)—
who has the power to manage, acquire, or dispose of any asset of a plan;
who (i) is registered as an investment adviser under the Investment Advisers Act of 1940 [15 U.S.C. 80b–1 et seq.]; (ii) is not registered as an investment adviser under such Act by reason of paragraph (1) of section 203A(a) of such Act [15 U.S.C. 80b–3a(a)], is registered as an investment adviser under the laws of the State (referred to in such paragraph (1)) in which it maintains its principal office and place of business, and, at the time the fiduciary last filed the registration form most recently filed by the fiduciary with such State in order to maintain the fiduciary’s registration under the laws of such State, also filed a copy of such form with the Secretary; (iii) is a bank, as defined in that Act; or (iv) is an insurance company qualified to perform services described in subparagraph (A) under the laws of more than one State; and
has acknowledged in writing that he is a fiduciary with respect to the plan.
The terms “plan year” and “fiscal year of the plan” mean, with respect to a plan, the calendar, policy, or fiscal year on which the records of the plan are kept.
The term “multiple employer welfare arrangement” means an employee welfare benefit plan, or any other arrangement (other than an employee welfare benefit plan), which is established or maintained for the purpose of offering or providing any benefit described in paragraph (1) to the employees of two or more employers (including one or more self-employed individuals), or to their beneficiaries, except that such term does not include any such plan or other arrangement which is established or maintained—
under or pursuant to one or more agreements which the Secretary finds to be collective bargaining agreements,
by a rural electric cooperative, or
by a rural telephone cooperative association.
For purposes of this paragraph—
two or more trades or businesses, whether or not incorporated, shall be deemed a single employer if such trades or businesses are within the same control group,
the term “control group” means a group of trades or businesses under common control,
the determination of whether a trade or business is under “common control” with another trade or business shall be determined under regulations of the Secretary applying principles similar to the principles applied in determining whether employees of two or more trades or businesses are treated as employed by a single employer under section 1301(b) of this title, except that, for purposes of this paragraph, common control shall not be based on an interest of less than 25 percent,
the term “rural electric cooperative” means—
any organization which is exempt from tax under section 501(a) of title 26 and which is engaged primarily in providing electric service on a mutual or cooperative basis, and
any organization described in paragraph (4) or (6) of section 501(c) of title 26 which is exempt from tax under section 501(a) of title 26 and at least 80 percent of the members of which are organizations described in subclause (I), and
the term “rural telephone cooperative association” means an organization described in paragraph (4) or (6) of section 501(c) of title 26 which is exempt from tax under section 501(a) of title 26 and at least 80 percent of the members of which are organizations engaged primarily in providing telephone service to rural areas of the United States on a mutual, cooperative, or other basis.
The term “single-employer plan” means an employee benefit plan other than a multiemployer plan.
the 4 term “plan assets” means plan assets as defined by such regulations as the Secretary may prescribe, except that under such regulations the assets of any entity shall not be treated as plan assets if, immediately after the most recent acquisition of any equity interest in the entity, less than 25 percent of the total value of each class of equity interest in the entity is held by benefit plan investors. For purposes of determinations pursuant to this paragraph, the value of any equity interest held by a person (other than such a benefit plan investor) who has discretionary authority or control with respect to the assets of the entity or any person who provides investment advice for a fee (direct or indirect) with respect to such assets, or any affiliate of such a person, shall be disregarded for purposes of calculating the 25 percent threshold. An entity shall be considered to hold plan assets only to the extent of the percentage of the equity interest held by benefit plan investors. For purposes of this paragraph, the term “benefit plan investor” means an employee benefit plan subject to part 4,5 any plan to which section 4975 of title 26 applies, and any entity whose underlying assets include plan assets by reason of a plan’s investment in such entity.
The term “pooled employer plan” means a plan—
which is an individual account plan established or maintained for the purpose of providing benefits to the employees of 2 or more employers;
which is a plan described in section 401(a) of title 26 which includes a trust exempt from tax under section 501(a) of title 26, a plan that consists of annuity contracts described in section 403(b) of title 26, or a plan that consists of individual retirement accounts described in section 408 of title 26 (including by reason of subsection (c) thereof); and
the terms of which meet the requirements of subparagraph (B).
Such term shall not include a plan maintained by employers which have a common interest other than having adopted the plan, but such term shall include any plan (other than a plan excepted from the application of this title by section 1003(b)(2) of this title) maintained for the benefit of the employees of more than 1 employer that consists of annuity contracts described in section 403(b) of title 26 and that meets the requirements of subparagraph (B) of section 413(e)(1) of title 26.
The requirements of this subparagraph are met with respect to any plan if the terms of the plan—
designate a pooled plan provider and provide that the pooled plan provider is a named fiduciary of the plan;
designate a named fiduciary (other than an employer in the plan) to be responsible for collecting contributions to the plan and require such fiduciary to implement written contribution collection procedures that are reasonable, diligent, and systematic;
provide that each employer in the plan retains fiduciary responsibility for—
the selection and monitoring in accordance with section 1104(a) of this title of the person designated as the pooled plan provider and any other person who, in addition to the pooled plan provider, is designated as a named fiduciary of the plan; and
to the extent not otherwise delegated to another fiduciary by the pooled plan provider and subject to the provisions of section 1104(c) of this title, the investment and management of the portion of the plan’s assets attributable to the employees of the employer (or beneficiaries of such employees);
provide that employers in the plan, and participants and beneficiaries, are not subject to unreasonable restrictions, fees, or penalties with regard to ceasing participation, receipt of distributions, or otherwise transferring assets of the plan in accordance with section 1058 of this title or paragraph (44)(C)(i)(II); 6
require—
the pooled plan provider to provide to employers in the plan any disclosures or other information which the Secretary may require, including any disclosures or other information to facilitate the selection or any monitoring of the pooled plan provider by employers in the plan; and
each employer in the plan to take such actions as the Secretary or the pooled plan provider determines are necessary to administer the plan or for the plan to meet any requirement applicable under this chapter or title 26 to a plan described in section 401(a) of title 26, a plan that consists of annuity contracts described in section 403(b) of title 26, or to a plan that consists of individual retirement accounts described in section 408 of title 26 (including by reason of subsection (c) thereof), whichever is applicable, including providing any disclosures or other information which the Secretary may require or which the pooled plan provider otherwise determines are necessary to administer the plan or to allow the plan to meet such requirements; and
provide that any disclosure or other information required to be provided under clause (v) may be provided in electronic form and will be designed to ensure only reasonable costs are imposed on pooled plan providers and employers in the plan.
The term “pooled employer plan” does not include—
a multiemployer plan; or
a plan established before December 20, 2019, unless the plan administrator elects that the plan will be treated as a pooled employer plan and the plan meets the requirements of this subchapter applicable to a pooled employer plan established on or after such date.
Except with respect to the administrative duties of the pooled plan provider described in paragraph (44)(A)(i), each employer in a pooled employer plan shall be treated as the plan sponsor with respect to the portion of the plan attributable to employees of such employer (or beneficiaries of such employees).
The term “pooled plan provider” means a person who—
is designated by the terms of a pooled employer plan as a named fiduciary, as the plan administrator, and as the person responsible for the performance of all administrative duties (including conducting proper testing with respect to the plan and the employees of each employer in the plan) which are reasonably necessary to ensure that—
the plan meets any requirement applicable under this chapter or title 26 to a plan described in section 401(a) of title 26, a plan that consists of annuity contracts described in section 403(b) of title 26, or to a plan that consists of individual retirement accounts described in section 408 of title 26 (including by reason of subsection (c) thereof), whichever is applicable; and
each employer in the plan takes such actions as the Secretary or pooled plan provider determines are necessary for the plan to meet the requirements described in subclause (I), including providing the disclosures and information described in paragraph (43)(B)(v)(II);
registers as a pooled plan provider with the Secretary, and provides to the Secretary such other information as the Secretary may require, before beginning operations as a pooled plan provider;
acknowledges in writing that such person is a named fiduciary, and the plan administrator, with respect to the pooled employer plan; and
is responsible for ensuring that all persons who handle assets of, or who are fiduciaries of, the pooled employer plan are bonded in accordance with section 1112 of this title.
The Secretary may perform audits, examinations, and investigations of pooled plan providers as may be necessary to enforce and carry out the purposes of this paragraph and paragraph (43).
The Secretary shall issue such guidance as the Secretary determines appropriate to carry out this paragraph and paragraph (43), including guidance—
to identify the administrative duties and other actions required to be performed by a pooled plan provider under either such paragraph; and
which requires in appropriate cases that if an employer in the plan fails to take the actions required under subparagraph (A)(i)(II)—
the assets of the plan attributable to employees of such employer (or beneficiaries of such employees) are transferred to a plan maintained only by such employer (or its successor), to an eligible retirement plan as defined in section 402(c)(8)(B) of title 26 for each individual whose account is transferred, or to any other arrangement that the Secretary determines is appropriate in such guidance; and
such employer (and not the plan with respect to which the failure occurred or any other employer in such plan) shall, except to the extent provided in such guidance, be liable for any liabilities with respect to such plan attributable to employees of such employer (or beneficiaries of such employees).
The Secretary shall take into account under clause (ii) whether the failure of an employer or pooled plan provider to provide any disclosures or other information, or to take any other action, necessary to administer a plan or to allow a plan to meet requirements described in subparagraph (A)(i)(II) has continued over a period of time that demonstrates a lack of commitment to compliance. The Secretary may waive the requirements of subclause (ii)(I) in appropriate circumstances if the Secretary determines it is in the best interests of the employees of the employer referred to in such clause (and the beneficiaries of such employees) to retain the assets in the plan with respect to which the employer’s failure occurred.
An employer or pooled plan provider shall not be treated as failing to meet a requirement of guidance issued by the Secretary under subparagraph (C) if, before the issuance of such guidance, the employer or pooled plan provider complies in good faith with a reasonable interpretation of the provisions of this paragraph, or paragraph (43), to which such guidance relates.
For purposes of this paragraph, in determining whether a person meets the requirements of this paragraph to be a pooled plan provider with respect to any plan, all persons who perform services for the plan and who are treated as a single employer under subsection (b), (c), (m), or (o) of section 414 of title 26 shall be treated as one person.
The term “pension-linked emergency savings account” means a short-term savings account established and maintained as part of an individual account plan, in accordance with section 1193 of this title, on behalf of an eligible participant (as such term is defined in section 1193(b) of this title) that—
is a designated Roth account (within the meaning of section 402A of title 26) and accepts only participant contributions, as described in section 1193(d)(1)(A) of this title, which are designated Roth contributions subject to the rules of section 402A(e) of title 26; and
meets the requirements of part 8 of subtitle B.
Source credit: (Pub. L. 93–406, title I, § 3, Sept. 2, 1974, 88 Stat. 833; Pub. L. 96–364, title III, §§ 302, 305, title IV, §§ 407(a), 409, Sept. 26, 1980, 94 Stat. 1291, 1294, 1303, 1307; Pub. L. 97–473, title III, § 302(a), Jan. 14, 1983, 96 Stat. 2612; Pub. L. 99–272, title XI, § 11016(c)(1), Apr. 7, 1986, 100 Stat. 273; Pub. L. 99–509, title IX, § 9203(b)(1), Oct. 21, 1986, 100 Stat. 1979; Pub. L. 99–514, title XVIII, § 1879(u)(3), Oct. 22, 1986, 100 Stat. 2913; Pub. L. 100–202, § 136(a), Dec. 22, 1987, 101 Stat. 1329–441; Pub. L. 101–239, title VII, §§ 7871(b)(2), 7881(m)(2)(D), 7891(a)(1), 7893(a), 7894(a)(1)(A), (2)(A), (3), (4), Dec. 19, 1989, 103 Stat. 2435, 2444, 2445, 2447, 2448; Pub. L. 101–508, title XII, § 12002(b)(2)(C), Nov. 5, 1990, 104 Stat. 1388–566; Pub. L. 102–89, § 2, Aug. 14, 1991, 105 Stat. 446; Pub. L. 104–290, title III, § 308(b)(1), Oct. 11, 1996, 110 Stat. 3440; Pub. L. 105–72, § 1(a), Nov. 10, 1997, 111 Stat. 1457; Pub. L. 109–280, title VI, § 611(f), title IX, §§ 905(a), 906(a)(2)(A), title XI, §§ 1104(c), 1106(a), Aug. 17, 2006, 120 Stat. 972, 1050, 1051, 1060; Pub. L. 110–28, title VI, § 6611(a)(1), (b)(1), May 25, 2007, 121 Stat. 179, 180; Pub. L. 110–458, title I, § 111(c), Dec. 23, 2008, 122 Stat. 5113; Pub. L. 116–94, div. O, title I, § 101(b), (c)(1), (3), Dec. 20, 2019, 133 Stat. 3141, 3144; Pub. L. 117–328, div. T, title I, §§ 105(a), 106(d), 127(a), Dec. 29, 2022, 136 Stat. 5286, 5287, 5317.)
- 1974Enacted · Pub. L. 93-406 · 88 Stat. 833
- 1980Amended · Pub. L. 96-364 · 94 Stat. 1291, 1294, 1303, 1307
- 1983Amended · Pub. L. 97-473 · 96 Stat. 2612
- 1986Amended · Pub. L. 99-272 · 100 Stat. 273
- 1986Amended · Pub. L. 99-509 · 100 Stat. 1979
- 1986Amended · Pub. L. 99-514 · 100 Stat. 2913
- 1987Amended · Pub. L. 100-202 · 101 Stat. 1329
- 1989Amended · Pub. L. 101-239 · 103 Stat. 2435, 2444, 2445, 2447, 2448
- 1990Amended · Pub. L. 101-508 · 104 Stat. 1388
- 1991Amended · Pub. L. 102-89 · 105 Stat. 446
- 1996Amended · Pub. L. 104-290 · 110 Stat. 3440
- 1997Amended · Pub. L. 105-72 · 111 Stat. 1457
- 2006Amended · Pub. L. 109-280 · 120 Stat. 972, 1050, 1051, 1060
- 2007Amended · Pub. L. 110-28 · 121 Stat. 179, 180
- 2008Amended · Pub. L. 110-458 · 122 Stat. 5113
- 2019Amended · Pub. L. 116-94 · 133 Stat. 3141, 3144
- 2022Amended · Pub. L. 117-328 · 136 Stat. 5286, 5287, 5317
A history note hasn’t been published yet. The record shows enactment by Pub. L. 93-406 on 1974-09-02.
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