DOL, PBGC announce retirement plan civil penalties for 2024
DOL penalties
| Type of failure | 2024 | 2023 |
|---|---|---|
| Failure to file Form 5500 | $2,670/day late | $2,586/day late |
| Failure to provide plan documents to DOL within 30 days after request | $190/day late, capped at $1,906/request | $184/day late, capped at $1,846/request |
| Failure to notify DB plan participants about funding-based restrictions on benefit accruals, lump sums and other accelerated payment forms or unpredictable contingent-event benefits | $2,112/day late per participant | $2,046/day late per participant |
| Failure to notify DC plan participants about automatic contribution arrangements | $2,112/day late per participant | $2,046/day late per participant |
| Failure to notify DC plan participants of blackout period | $169/day late per participant | $164/day late per participant |
| Failure to notify DC plan participants about right to divest employer stock | $169/day late per participant | $164/day late per participant |
| Failure to notify separated participants about deferred vested benefits | $37/participant | $36/participant |
| Failure to maintain sufficient plan administration records | $37/participant | $36/participant |
| Failure of DB plan with liquidity shortfall to limit distributions to monthly single-life annuity amount plus any Social Security supplement | $20,579/distribution | $19,933/distribution |
| Failure of cooperative and small-employer charity plan to establish or update funding restoration plan | $130/day late | $126/day late |
PBGC penalties
PBGC’s 2024 maximum penalty under ERISA Section 4071 for single-employer DB plans is $2,670 a day (up from $2,586 in 2023) for each day a filing, notice or other information is overdue. The higher rate applies to penalties assessed after Jan. 12, 2024. This penalty could apply to virtually any late PBGC information or premium filing for a single-employer plan, including:
- Premium filings (the late-filing penalty is separate from the penalty on premium underpayments)
- ERISA Section 4010 controlled-group financial and plan actuarial information filings
- Form 10 or 10-Advance reportable-event filings
- Form 200 filings to report missed contributions in excess of $1 million
- ERISA Section 4062(e) notices (when permanent cessation of operations at a facility results in a workforce reduction affecting more than 15% of all employees eligible to participate in any qualified retirement plan in the controlled group)
- ERISA Section 4063 notices (when a substantial employer has withdrawn from a multiple-employer plan)
Maximum penalty rarely assessed. In practice, PBGC rarely assesses the maximum penalty. The agency's current penalty policy calls for much smaller penalties, especially when a delinquent filing is made soon after the due date or the plan is small. However, depending on the facts and circumstances, PBGC might assess the maximum penalty in two situations:
- A sponsor fails to file Form 200 reporting a missed contribution that brings the total unpaid amount (including interest) to more than $1 million — or files the form more than 10 days after the missed contribution's due date — if PBGC would have perfected a lien had the agency known about the missed contribution. (If the sponsor promptly deposits the missed contribution, the agency typically won't perfect the lien.)
A nonpublicly traded employer with large unfunded vested benefits (for variable-rate PBGC premiums) fails to provide advance notice of a reportable event under ERISA Section 4043(b).
Related resources
Non-Mercer resources
- DOL adjustment of civil penalties for 2024 (Federal Register, Jan. 11, 2024)
- PBGC adjustment of civil penalties for 2024 (Federal Register, Jan. 12, 2024)
- PBGC assessment of penalties for failure to provide required information (Federal Register, July 18, 1995)
Mercer Law & Policy resources
- 2024 compliance calendar for single-employer defined benefit plans (Nov. 21, 2023)
- 2024 compliance calendar for single-employer defined contribution plans (Nov. 21, 2023)
- DOL, PBGC announce retirement plan civil penalties for 2023 (Jan. 19, 2023)