View all text of Chapter 43 [§ 4971 - § 4980I]
§ 4980F. Failure of applicable plans reducing benefit accruals to satisfy notice requirements
(a) Imposition of tax
(b) Amount of tax
(1) In general
(2) Noncompliance period
(c) Limitations on amount of tax
(1) Tax not to apply where failure not discovered and reasonable diligence exercised
(2) Tax not to apply to failures corrected within 30 days
No tax shall be imposed by subsection (a) on any failure if—
(A) any person subject to liability for the tax under subsection (d) exercised reasonable diligence to meet the requirements of subsection (e), and
(B) such person provides the notice described in subsection (e) during the 30-day period beginning on the first date such person knew, or exercising reasonable diligence would have known, that such failure existed.
(3) Overall limitation for unintentional failures
(A) In general
(B) Taxable years in the case of certain controlled groups
(4) Waiver by Secretary
(d) Liability for tax
The following shall be liable for the tax imposed by subsection (a):
(1) In the case of a plan other than a multiemployer plan, the employer.
(2) In the case of a multiemployer plan, the plan.
(e) Notice requirements for plans significantly reducing benefit accruals
(1) In general
(2) Notice
The notice required by paragraph (1) shall be written in a manner calculated to be understood by the average plan participant and shall provide sufficient information (as determined in accordance with regulations prescribed by the Secretary) to allow applicable individuals to understand the effect of the plan amendment. The Secretary may provide a simplified form of notice for, or exempt from any notice requirement, a plan—
(A) which has fewer than 100 participants who have accrued a benefit under the plan, or
(B) which offers participants the option to choose between the new benefit formula and the old benefit formula.
(3) Timing of notice
(4) Designees
(5) Notice before adoption of amendment
(f) Definitions and special rules
For purposes of this section—
(1) Applicable individual
The term “applicable individual” means, with respect to any plan amendment—
(A) each participant in the plan, and
(B) any beneficiary who is an alternate payee (within the meaning of section 414(p)(8)) under an applicable qualified domestic relations order (within the meaning of section 414(p)(1)(A)),
whose rate of future benefit accrual under the plan may reasonably be expected to be significantly reduced by such plan amendment.
(2) Applicable pension plan
The term “applicable pension plan” means—
(A) any defined benefit plan described in section 401(a) which includes a trust exempt from tax under section 501(a), or
(B) an individual account plan which is subject to the funding standards of section 412.
Such term shall not include a governmental plan (within the meaning of section 414(d)) or a church plan (within the meaning of section 414(e)) with respect to which the election provided by section 410(d) has not been made.
(3) Early retirement
(g) New technologies
(Added Pub. L. 107–16, title VI, § 659(a)(1), June 7, 2001, 115 Stat. 137; amended Pub. L. 107–147, title IV, § 411(u)(1), Mar. 9, 2002, 116 Stat. 51; Pub. L. 109–280, title V, § 502(c)(2), Aug. 17, 2006, 120 Stat. 941.)