Terminating a defined benefit pension plan requires careful planning and meticulous attention to detail. The planning and execution process takes anywhere from 6 months to over 2 years and requires a focused, coordinated effort of the employer, actuary, legal counsel, benefits committee, administrator and others. The PBGC, IRS, and DOL all have their specific filing requirements as well.
Prior to any actual termination work, steps must be taken to ensure the plan is in adequate operational and financial shape. The funding level of the plan, the accuracy and availability of participant data, number of missing participants, and whether a replacement plan will be offered in place of the terminated plan are examples of issues which must be considered prior to any move to terminate.
Once the decision to terminate is made, a detailed project plan must be developed and executed. SBA resources manage and execute all aspects of defined benefit pension plan terminations for our clients. Because we are financial and operational defined benefit experts, we are ideally positioned to guide clients though the planning process and flawlessly execute the plan.