PBGC proposes to codify policy on monetary penalties 

September 3, 2026

A new proposed regulation from the Pension Benefit Guaranty Corp. (PBGC) would codify the agency’s policy on monetary penalties for failure to timely provide certain required filings and notices. The proposal would also add detail on the factors PBGC considers when assessing or waiving penalties. Comments are due September 21.

Although the proposal addresses penalties for single- and multiemployer plans, this article only discusses the impact on single-employer plans.

ERISA Section 4071 authorizes PBGC to assess civil penalties on defined benefit (DB) plan sponsors for failures to timely provide required notices or other material information, such as premium filings, reportable-event filings, or Section 4010 filings for underfunded plans. PBGC’s existing regulation sets the maximum penalty that may be imposed on the sponsor of a single-employer DB plan (currently $2,739 per day), but the agency has broad discretion to impose lower penalties or waive penalties altogether.

Neither the statute nor the regulation provides any detail about how penalties should be assessed. PBGC issued an initial policy statement laying out its approach in 1992 and followed up with a revised policy statement in 1995, which remains in effect today. The policy is intended to promote voluntary compliance, encourage self-correction, and avoid unduly harsh penalties, particularly for small businesses and plans.

Under the current policy, PBGC considers relevant facts and circumstances “to assure that the penalty fits the violation.” Penalties are generally $25 per day for the first 90 days of delinquency and $50 per day thereafter, but are proportionately lower for plans with fewer than 100 participants (but not less than $5 per day).

PBGC has determined that the current policy is not adequate for addressing many situations where a penalty might be imposed. When finalized, the proposal would supersede the 1995 policy. However, the proposed regulation isn’t intended to change PBGC’s position on these “information penalties.” Instead, it would address circumstances not covered in the current policy and reflect changes in the law since 1995. The proposal’s major provisions would:

• State that, in most cases, PBGC would assess penalties significantly below the statutory maximum
• Provide that, depending on facts and circumstances, PBGC would generally waive penalties for reasonable cause, error of law, PBGC delay, or any other circumstances PBGC deems appropriate
• Encourage voluntary self-reporting and self-correction by providing lower penalties for violations reported and corrected early
• State that penalty amounts would be intended to reflect the potential for harm to participants and PBGC from the untimely filing — failures with higher potential for harm would result in higher penalties

The proposal would also clarify how filers could request reconsideration of assessed penalties.

The proposal would maintain a general per diem level of penalties for many failures. The general penalties would start at the same $25 and $50 levels as in the 1995 policy statement, but the proposal’s preamble explains that these amounts would be indexed for inflation going forward. The penalty amounts would sometimes — but not always — be proportionately reduced for plans with fewer than 100 participants. The minimum penalty of $5 per day would be increased to $10 per day. Higher penalty amounts would apply to certain types of failures.

PBGC would retain broad discretion to waive penalties in whole or in part. When making waiver decisions, the agency would assess the facts and circumstances of each case and treat similar situations consistently. PBGC would generally waive penalties if it determined that an untimely filing was due to one of the following:

• Reasonable cause — The untimeliness was due to circumstances beyond the filer’s control, and the filer couldn’t have met the deadline using “ordinary business care and prudence.” When making this determination, PBGC would consider the size of the filer and the seriousness of the matter. For this purpose, PBGC would treat an outside advisor — such as an actuary, attorney, or third-party administrator — as if it were part of the filer. The preamble explains that this means PBGC would consider whether the advisor exercised ordinary business care and prudence when determining whether the filer should receive a waiver.
• Error of law — The untimeliness was due to a filer’s reasonable reliance on an “erroneous interpretation” of law or an “excusable ignorance of a recent change in the law.” In the preamble, PBGC explains that this would avoid penalizing filers that take reasonable and defensible legal positions, even if those positions were ultimately incorrect.
• PBGC delay — PBGC would generally waive the portion of a penalty that accrued because of a delay in PBGC’s response to a “non-frivolous” argument about the applicability of the information requirement.
• Other factors — PBGC would retain the discretion to waive penalties in other circumstances it deems appropriate.

Commenters may address any part of the proposal, but PBGC specifically requests comments on the following:

• What mitigating and aggravating factors PBGC should consider when reviewing violations and determining whether to assess or waive penalties
• Whether PBGC should adjust the initial $25 and $50 penalty levels to account for inflation from 1995 to the present

• Penalties for failure to provide certain notices or other material information (Federal Register, July 21, 2026)
• Assessment of penalties for failure to provide required information (Federal Register, July 18, 1995)

• Civil monetary penalties won't increase for 2026 (May 27, 2026)