Changes Relating to Multi-employer Plans in the Pension Protection Act

The changes relating to multi-employer plans in the Pension Protection Act are very detailed in the law but other highlights include, according to TaxWatch:

1.) Changing the amortization schedule for any plan benefit amendments from 30 years to 15 years;

2.) Increasing the maximum deductible limit to 140% of current liability, providing additional funding flexibility for plans each year;

3.) Requiring plan trustees to improve the health of the plan by one-third within 10 years if a plan is less than 80% funded or will hit a funding deficiency within seven years.

United Parcel Service, whose employees participate in the largest multiemployer plan in the country, may be a beneficiary of the controversial clause, according to the New York Times. UPS will be negotiating with the Teamster’s Union in coming months, according to the New York Times, and “has been eager to increase its control over troubled plans such as the Teamsters' Central States Pension Fund.” Read more at accountingweb.com