The Washington Report
April 18, 2018
Update to Standard and Distress Terminations Forms and Instructions
On April 17, 2018, the Pension Benefit Guaranty Corporation (PBGC) announced that the Office of Management and Budget approved minor revisions to the standard and distress termination forms and instructions. According to the PBGC, key changes include a new option for submitting these filings by email and the ability to request a pre-filing consultation to determine if a distress filing application is warranted (see PBGC’s “Distress Terminations” web page for more information, link provided below). In addition, because the rules related to missing participants differ depending on whether the date of plan termination is before January 1, 2018, the post-distribution certifications (i.e., Forms 501 and 602, for standard and distress terminations respectively), have been modified slightly so that they can be used for both pre-2018 and post-2017 terminations.
The PBGC Employers and Practitioners page is available here.
The new forms and instructions can be found on PBGC’s Forms for Pension Practitioners and Employers page, available here.
The PBGC’s Distress Terminations page is available here.
DOL Issues Three New Wage and Hour Opinion Letters
On April 12, 2018, the Department of Labor’s (DOL) Wage and Hour Division issued three new opinion letters. The letters address compliance under the Fair Labor Standards Act (FLSA) and other laws:
- What counts as work time under the FLSA when employees travel for work;
- Whether 15-minute rest breaks required every hour by an employee’s serious health condition must be paid or may be uncompensated; and
- Whether certain lump-sum payments from employers to employees are considered “earnings” for garnishment purposes under Title III of the Consumer Credit Protection Act.
The DOL news release is available here.
The Family and Medical Leave Act opinion letter is available here.
The travel time opinion letter is available here.
The lump-sum payments opinion letter is available here.
IRS Issues FAQs for Employers on Paid FMLA Tax Credit
The Internal Revenue Service (IRS) issued a set of Frequently Asked Questions (FAQs) on implementing new Section 45S of the Internal Revenue Code, entitled the “Employer Credit for Paid Family and Medical Leave.” While the IRS’s FAQs do not provide much new information for employers, they do indicate that the IRS is turning its attention to this two-year pilot program.
The Employer Credit for Paid Family and Medical Leave is a general business credit an employer may claim under certain conditions for wages paid to qualifying employees while they are on family and medical leave (FMLA). In order to take advantage of the credit, the FAQs state that the employer must have a written policy for paid FMLA. The FAQs also institute a rule against “double-dipping”: the employer must reduce its deduction for wages or salaries paid or incurred by the amount of the FMLA credit, and any wages taken into account in determining any other general business credit may not be used in determining the FMLA credit.
The Aon bulletin, which provides a brief overview of the FAQs, is available here.
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