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Pension Benefit Guaranty Corporation
- 29 CFR Part 4044
AGENCY:
Pension Benefit Guaranty Corporation.
ACTION:
Final rule.
SUMMARY:
This rule amends the Pension Benefit Guaranty Corporation's regulation on Allocation of Assets in Single-Employer Plans by substituting a
( printed page 59973)
new table for determining expected retirement ages for participants in pension plans undergoing distress or involuntary termination with valuation dates falling in 2026. This table is needed to compute the value of early retirement benefits and, thus, the total value of benefits under a plan. This rule also provides the mortality assumption for use with PBGC's missing participants program for determination dates in 2026.
DATES:
This rule is effective January 1, 2026.
FOR FURTHER INFORMATION CONTACT:
Andrew Wilson (
wilson.andrew1@pbgc.gov), Attorney (202-860-8354), or Joseph Krettek (
krettek.joseph@pbgc.gov), Assistant General Counsel (202-229-6772), Office of the General Counsel, Pension Benefit Guaranty Corporation, 445 12th Street SW, Washington, DC 20024-2101. If you are deaf or hard of hearing, or have a speech disability, please dial 7-1-1 to access telecommunications relay services.
SUPPLEMENTARY INFORMATION:
Background
The Pension Benefit Guaranty Corporation (PBGC) administers the pension plan termination insurance program under title IV of the Employee Retirement Income Security Act of 1974 (ERISA). PBGC's regulation on Allocation of Assets in Single-Employer Plans (29 CFR part 4044) sets forth (in subpart B) the methods for valuing plan benefits of terminating single-employer plans covered under title IV. Guaranteed benefits and benefit liabilities under a plan that is undergoing a distress termination must be valued in accordance with subpart B of part 4044. In addition, when PBGC terminates an underfunded plan involuntarily pursuant to ERISA section 4042(a), it uses the subpart B valuation rules to determine the amount of the plan's underfunding.
Expected Retirement Age Low, Medium, High Tables
Under § 4044.51(b) of the asset allocation regulation, early retirement benefits are valued based on the annuity starting date, if a retirement date has been selected, or the expected retirement age, if the annuity starting date is not known on the valuation date. Sections 4044.55 through 4044.58 set forth rules for determining the expected retirement ages for plan participants entitled to early retirement benefits. Section 4044.58 contains tables to be used in determining the expected early retirement ages.[1]
Table I to § 4044.58 (Selection of Retirement Rate Category) is used to determine whether a participant has a low, medium, or high probability of retiring early. The determination is based on the year a participant would reach “unreduced retirement age” (URA) (
i.e.,
the earlier of the normal retirement age or the age at which an unreduced benefit is first payable) and the participant's monthly benefit at the unreduced retirement age. The table applies only to plans with valuation dates in the current year and is updated annually by PBGC to reflect changes in the cost of living.
Tables II-A, II-B, and II-C (Expected Retirement Ages for Individuals in the Low, Medium, and High Categories respectively) are used to determine the expected retirement age after the probability of early retirement has been determined using Table I. These tables establish, by probability category, the expected retirement age based on both the earliest age a participant could retire under the plan and the unreduced retirement age. This expected retirement age is used to compute the value of the early retirement benefit and, thus, the total value of benefits under the plan.
This document amends § 4044.58 to replace Table I-25 with Table I-26 to provide an updated correlation, appropriate for calendar year 2026, between the amount of a participant's benefit and the probability that the participant will elect early retirement. Table I-26 will be used to value benefits in plans with valuation dates during calendar year 2026.
Missing Participants Mortality Assumptions
PBGC's regulation on Missing Participants (29 CFR part 4050) provides that the mortality assumption used to determine certain amounts to be transferred on behalf of a missing participant from a terminating defined benefit plan to PBGC is the mortality table in § 4044.53(h). The table currently provides the mortality assumption for benefit determination dates on or after July 31, 2024, but before January 1, 2026.[2]
This rule updates the table to provide the mortality assumption for benefit determination dates in 2026.
Compliance With Regulatory Requirements
PBGC has determined that notice of, and public comment on, this rule are impracticable, unnecessary, and contrary to the public interest. PBGC's update of § 4044.58 and § 4044.53(h) for calendar year 2026 are routine. If a plan has a valuation date in 2026, the plan administrator needs the updated table in § 4044.58 being promulgated in this rule to value benefits. Similarly, if a plan is transferring amounts on behalf of missing participants under part 4050, the plan administrator needs the updated mortality table in § 4044.53(h) for benefit determination dates in 2026. Accordingly, PBGC finds that the public interest is best served by issuing these tables expeditiously, without an opportunity for notice and comment, and that good cause exists for making the table set forth in this amendment effective less than 30 days after publication to allow the use of the proper tables to determine the value benefits for dates in early 2026.
PBGC has determined that this action is not a “significant regulatory action” under the criteria set forth in Executive Order 12866.
Because no general notice of proposed rulemaking is required for this regulation, the Regulatory Flexibility Act of 1980 does not apply (5 U.S.C. 601(2)).
List of Subjects in 29 CFR Part 4044
- Employee benefit plans
- Pension insurance
In consideration of the foregoing, 29 CFR part 4044 is amended as follows:
PART 4044—ALLOCATION OF ASSETS IN SINGLE-EMPLOYER PLANS
1. The authority citation for part 4044 continues to read as follows:
Authority:
29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.
2. Amend § 4044.53 by revising table 4 to paragraph (h) to read as follows:
§ 4044.53
Mortality assumptions.
* * * * *
(h) * * *
( printed page 59974)
Table 4 to Paragraph (
h
)—Missing Participants Unisex Mortality Table
| Age |
Benefit
determination
dates in 2024 |
Benefit
determination
dates in 2025 |
Benefit
determination
dates in 2026 |
| 0 |
0.00207 |
0.00204 |
0.00202 |
| 1 |
0.00015 |
0.00014 |
0.00014 |
| 2 |
0.00010 |
0.00009 |
0.00009 |
| 3 |
0.00008 |
0.00007 |
0.00007 |
| 4 |
0.00006 |
0.00006 |
0.00006 |
| 5 |
0.00006 |
0.00005 |
0.00005 |
| 6 |
0.00005 |
0.00005 |
0.00005 |
| 7 |
0.00005 |
0.00005 |
0.00005 |
| 8 |
0.00004 |
0.00004 |
0.00004 |
| 9 |
0.00004 |
0.00004 |
0.00003 |
| 10 |
0.00004 |
0.00004 |
0.00004 |
| 11 |
0.00004 |
0.00004 |
0.00004 |
| 12 |
0.00005 |
0.00005 |
0.00005 |
| 13 |
0.00006 |
0.00006 |
0.00006 |
| 14 |
0.00008 |
0.00007 |
0.00007 |
| 15 |
0.00009 |
0.00009 |
0.00008 |
| 16 |
0.00010 |
0.00010 |
0.00010 |
| 17 |
0.00012 |
0.00012 |
0.00012 |
| 18 |
0.00014 |
0.00014 |
0.00014 |
| 19 |
0.00016 |
0.00015 |
0.00015 |
| 20 |
0.00016 |
0.00016 |
0.00016 |
| 21 |
0.00017 |
0.00016 |
0.00016 |
| 22 |
0.00017 |
0.00017 |
0.00017 |
| 23 |
0.00018 |
0.00018 |
0.00018 |
| 24 |
0.00019 |
0.00019 |
0.00019 |
| 25 |
0.00020 |
0.00019 |
0.00019 |
| 26 |
0.00021 |
0.00020 |
0.00020 |
| 27 |
0.00022 |
0.00021 |
0.00021 |
| 28 |
0.00023 |
0.00022 |
0.00022 |
| 29 |
0.00023 |
0.00023 |
0.00023 |
| 30 |
0.00025 |
0.00025 |
0.00024 |
| 31 |
0.00026 |
0.00026 |
0.00026 |
| 32 |
0.00028 |
0.00027 |
0.00027 |
| 33 |
0.00030 |
0.00030 |
0.00030 |
| 34 |
0.00032 |
0.00031 |
0.00031 |
| 35 |
0.00034 |
0.00034 |
0.00033 |
| 36 |
0.00036 |
0.00036 |
0.00035 |
| 37 |
0.00038 |
0.00038 |
0.00037 |
| 38 |
0.00040 |
0.00040 |
0.00039 |
| 39 |
0.00043 |
0.00042 |
0.00041 |
| 40 |
0.00044 |
0.00044 |
0.00043 |
| 41 |
0.00046 |
0.00045 |
0.00044 |
| 42 |
0.00048 |
0.00047 |
0.00046 |
| 43 |
0.00049 |
0.00049 |
0.00048 |
| 44 |
0.00052 |
0.00051 |
0.00050 |
| 45 |
0.00054 |
0.00053 |
0.00052 |
| 46 |
0.00058 |
0.00057 |
0.00056 |
| 47 |
0.00061 |
0.00060 |
0.00059 |
| 48 |
0.00065 |
0.00064 |
0.00064 |
| 49 |
0.00070 |
0.00069 |
0.00068 |
| 50 |
0.00076 |
0.00076 |
0.00075 |
| 51 |
0.00085 |
0.00084 |
0.00083 |
| 52 |
0.00095 |
0.00094 |
0.00092 |
| 53 |
0.00106 |
0.00105 |
0.00103 |
| 54 |
0.00120 |
0.00118 |
0.00117 |
| 55 |
0.00143 |
0.00141 |
0.00139 |
| 56 |
0.00177 |
0.00174 |
0.00172 |
| 57 |
0.00205 |
0.00202 |
0.00200 |
| 58 |
0.00239 |
0.00235 |
0.00232 |
| 59 |
0.00276 |
0.00273 |
0.00269 |
| 60 |
0.00321 |
0.00317 |
0.00313 |
| 61 |
0.00370 |
0.00365 |
0.00360 |
| 62 |
0.00441 |
0.00434 |
0.00428 |
| 63 |
0.00514 |
0.00507 |
0.00500 |
| 64 |
0.00577 |
0.00570 |
0.00562 |
| 65 |
0.00658 |
0.00650 |
0.00641 |
| 66 |
0.00748 |
0.00738 |
0.00729 |
| 67 |
0.00834 |
0.00823 |
0.00813 |
| 68 |
0.00928 |
0.00916 |
0.00904 |
| 69 |
0.01034 |
0.01021 |
0.01008 |
|
( printed page 59975)
|
| 70 |
0.01155 |
0.01141 |
0.01127 |
| 71 |
0.01294 |
0.01278 |
0.01262 |
| 72 |
0.01452 |
0.01435 |
0.01417 |
| 73 |
0.01631 |
0.01611 |
0.01592 |
| 74 |
0.01837 |
0.01815 |
0.01794 |
| 75 |
0.02073 |
0.02049 |
0.02025 |
| 76 |
0.02345 |
0.02317 |
0.02291 |
| 77 |
0.02656 |
0.02626 |
0.02596 |
| 78 |
0.03012 |
0.02979 |
0.02945 |
| 79 |
0.03417 |
0.03382 |
0.03345 |
| 80 |
0.03899 |
0.03862 |
0.03823 |
| 81 |
0.04395 |
0.04356 |
0.04315 |
| 82 |
0.04959 |
0.04916 |
0.04872 |
| 83 |
0.05595 |
0.05549 |
0.05502 |
| 84 |
0.06317 |
0.06267 |
0.06217 |
| 85 |
0.07138 |
0.07083 |
0.07029 |
| 86 |
0.08063 |
0.08005 |
0.07947 |
| 87 |
0.09107 |
0.09044 |
0.08982 |
| 88 |
0.10286 |
0.10220 |
0.10154 |
| 89 |
0.11596 |
0.11526 |
0.11457 |
| 90 |
0.13036 |
0.12962 |
0.12889 |
| 91 |
0.14540 |
0.14463 |
0.14387 |
| 92 |
0.16090 |
0.16012 |
0.15933 |
| 93 |
0.17679 |
0.17601 |
0.17522 |
| 94 |
0.19284 |
0.19206 |
0.19127 |
| 95 |
0.20898 |
0.20822 |
0.20745 |
| 96 |
0.22620 |
0.22545 |
0.22467 |
| 97 |
0.24386 |
0.24311 |
0.24234 |
| 98 |
0.26196 |
0.26123 |
0.26048 |
| 99 |
0.28059 |
0.27986 |
0.27912 |
| 100 |
0.29960 |
0.29887 |
0.29814 |
| 101 |
0.31891 |
0.31817 |
0.31746 |
| 102 |
0.33825 |
0.33748 |
0.33676 |
| 103 |
0.35757 |
0.35673 |
0.35595 |
| 104 |
0.37670 |
0.37583 |
0.37502 |
| 105 |
0.39521 |
0.39436 |
0.39354 |
| 106 |
0.41327 |
0.41245 |
0.41166 |
| 107 |
0.43080 |
0.42999 |
0.42921 |
| 108 |
0.44743 |
0.44667 |
0.44595 |
| 109 |
0.46339 |
0.46271 |
0.46204 |
| 110 |
0.47628 |
0.47568 |
0.47508 |
| 111 |
0.48468 |
0.48417 |
0.48366 |
| 112 |
0.49268 |
0.49226 |
0.49184 |
| 113 |
0.49666 |
0.49634 |
0.49602 |
| 114 |
0.49795 |
0.49773 |
0.49751 |
| 115 |
0.49928 |
0.49915 |
0.49903 |
| 116 |
0.49960 |
0.49953 |
0.49945 |
| 117 |
0.49978 |
0.49973 |
0.49968 |
| 118 |
0.49995 |
0.49993 |
0.49990 |
| 119 |
0.50000 |
0.50000 |
0.50000 |
| 120 |
1.00000 |
1.00000 |
1.00000 |
3. Amend § 4044.58 by revising table 1 to the section to read as follows:
§ 4044.58
Tables used to determine expected retirement age.
* * * * *
Table 1 to § 4044.58—Table I-26—Selection of Retirement Rate Category
[For valuation dates in 2026 1
]
| If participant reaches URA in year— |
Participant's retirement rate category is— |
| Low 2
if monthly
benefit at URA
is less than— |
Medium 3
if monthly benefit at
URA is— |
High 4
if monthly
benefit at URA
is greater than— |
| From— |
To— |
| 2027 |
849 |
849 |
3,587 |
3,587 |
| 2028 |
869 |
869 |
3,670 |
3,670 |
|
( printed page 59976)
|
| 2029 |
888 |
888 |
3,750 |
3,750 |
| 2030 |
908 |
908 |
3,833 |
3,833 |
| 2031 |
928 |
928 |
3,917 |
3,917 |
| 2032 |
948 |
948 |
4,003 |
4,003 |
| 2033 |
969 |
969 |
4,092 |
4,092 |
| 2034 |
990 |
990 |
4,182 |
4,182 |
| 2035 |
1,012 |
1,012 |
4,274 |
4,274 |
| 2036 or later |
1,034 |
1,034 |
4,368 |
4,368 |
|
1
Applicable tables for valuation dates before 2026 are available on PBGC's website (
www.pbgc.gov). |
|
2
Table II-A. |
|
3
Table II-B. |
|
4
Table II-C. |
* * * * *
Joseph Krettek,
Assistant General Counsel, Pension Benefit Guaranty Corporation.
Footnotes
1.
In June 2024, PBGC issued a final rule at 89 FR 48291 updating the interest, mortality, and expense assumptions used to determine the present value of a single-employer plan's benefits when it terminates in a distress or involuntary termination. This rule moved the expected retirement ages tables from Appendix D in part 4044 to § 4044.58.
Back to Citation
2.
PBGC's June 2024 final rule does not apply to calculations where the valuation date is before July 31, 2024.
Back to Citation
[FR Doc. 2025-23799 Filed 12-22-25; 8:45 am]
BILLING CODE 7709-02-P