COLLECTED WISDOM™ on The Pension Protection Act of 2006

Here is a collection of articles, tables, commentary, rulings and other information on the Pension Protection Act of 2006.

This archive contains not only the most current material on the topic, but also older items that are still relevant, provide background, perspective or are germane to the topic.

If you find a broken link or an items that you feel is outdate, irrelevant or no longer appropriate, please let us know.

A Decade After PPA and the QDIA Debate Continues

The transition period, from five years before retirement to five years after, is the most critical phase of lifecycle investing and potentially the most difficult to manage with a standard TDF glide path.

Source: Planadviser.com, August 2017

Missed the PPA Restatement Deadline?

If you missed the PPA restatement deadline and failed to update your 401k plan document, you can still update it. And if you update it by April 30, 2017, then there are discounted penalties from IRS.

Source: Benefit-Resources.com, February 2017

The Pension Protection Act Decreased Retirement Security

The Pension Protection Act (PPA) was intended to do two things: first, to improve the funding levels of defined benefit pension plans; second, to increase participation in defined contribution 401(k)-style plans. The PPA set out to improve pension plan funding by increasing funding requirements and shifting plans to a market-based value of assets and liabilities. Unfortunately, rather than shoring up underfunded pension plans, the PPA prompted companies to close their plans altogether.

Source: Protectpensions.org, December 2016

Infographic: The Pension Protection Act, 10 Years In

Enacted in 2006, the Pension Protection Act (PPA) is one of the most significant legislative developments in the modern age of retirement policy. The PPA has dramatically increased plan participation rates and put millions of American workers on a path to better retirement outcomes.

Source: Troweprice.com, August 2016

What the Pension Protection Act Has Done for 401ks

Ten years on and what have we got to show for it? Quite a lot, according to Vanguard. The investment behemoth marks the 10th anniversary of the Pension Protection Act of 2006 by releasing a special 15th anniversary edition of its How America Saves report.

Source: 401kspecialistmag.com, June 2016

10 Years Later - Pension Protection Act's Impact on DC Plans

Called the "most sweeping reform of America's pension laws in over 30 years," the Pension Protection Act has had a significant impact on helping people save for retirement. Signed into law in 2006, the PPA most notably paved the way for auto-enrollment and also established life-cycle and target date funds as a QDIA.

Source: Troweprice.com, May 2016

DC Plan Stats Show Effect of PPA

The PPA set the stage for wide adoption of automatic features in DC plans and made Roth contributions permanently available for DC plan participants, among other things. Callan says the influence of the PPA has resulted in 61% of plan sponsors offering auto enrollment in their DC plans, and four out of five of those plan sponsors also auto escalate employee deferrals.

Source: Planadviser.com, January 2016

Grading the Pension Protection Act, Ten Years Later

The PPA heralded a new era for DC plans with the potential to greatly increase workers' access to retirement income security. As the PPA celebrates 10 years, paper asks: Was it successful? Did it transform DC plans in the way the industry had hoped?

Source: Callan.com, December 2015

QDIAs Under the Pension Protection Act

The Department of Labor's final fiduciary rule could be released before the next presidential inauguration in January 2017. For some, it is a very ambitious time frame and raises a question about how they can do it in that time frame.

Source: Consultrms.com, September 2015

The PPA Restatement Process

The PPA restatement process is underway. The Pension Protection Act of 2006 restatement process for pre-approved defined contribution, 401(a) plans, which began May 1, 2014, will run until April 30, 2016. This article addresses frequently asked questions about the restatement process and suggests some broad considerations to bear in mind as plans are restated.

Source: Ftwilliam.com, October 2014

Qualified Default Investment Alternatives

A key provision of the PPA was providing a safe harbor for plan fiduciaries investing participant assets in certain types of default investment alternatives in the absence of participant investment direction. Article discusses the conditions must be met for fiduciary relief.

Source: Strategicbenefitservices.com, June 2014

Does a Terminating Pre-approved Plan Need to Be Restated for PPA?

Plans that are terminating must be updated at the time of termination to reflect all applicable qualification requirements then in effect. This means the plan must have all relevant amendments at termination date. This may include requirements that were not listed on the most recent annual IRS Cumulative List.

Source: Relius.net, June 2014

Ready or Not, Here It Comes...the PPA Plan Restatement

It's time again to participate in that never ending ritual of qualified retirement plan restatements. As legislation affecting retirement plans is enacted, the IRS requires all plan sponsors to restate or "rewrite" their plans to conform to current law. For preapproved plans, these required restatements take place on a regular six year cycle. The current cycle of defined contribution plan restatements is being referred to as the "PPA restatement" after the Pension Protection Act.

Source: Pensysinc.com, June 2014

The Next Round of DC Plan Document Restatements

Periodically, all retirement plans must restate their Plan Documents and a new cycle for restatements is upon us. This plan restatement cycle is referred to as the PPA Restatement, named for the Pension Protection Act of 2006, and is only applicable to 401k and other Defined Contribution plans.

Source: Markleyactuarial.com, June 2014

Pension Protection Act Document Restatement FAQs

All DC plan documents (including 401k, Profit Sharing, and Money Purchase Plans) will need to be restated by no later than April 30, 2016 to incorporate the language and provisions from the Pension Protection Act, and various other required amendments that took effect between 2007 and 2011. Here is a list of frequently asked questions regarding the restatement process.

Source: Benefit-Resources.com, May 2014

IRS Defines PPA Restatement Period for Pre-Approved Defined Contribution Plans

The IRS has issued Announcement 2014-16, which specifies that pre-approved defined contribution plans being restated for the Pension Protection Act of 2006 and the 2010 IRS cumulative list qualification requirements must adopt their plan documents by April 30, 2016.

Source: Ascensus.com, March 2014

DOL Releases Final PPA Participant Advice Regulation

This final regulation brings to a conclusion an almost five-year process to implement the PPA exemptions permitting "level fee" and "computer model" advice for retirement plan participants and IRA beneficiaries. In broad scope, the final regulation retains the general structure and terms of the Obama Administration's March 2, 2010 proposal, with several refinements and clarifications. The regulation is effective as of December 27, 2011.

Source: Sutherland Asbill & Brennan LLP, October 2011.

IRS Issues Final Regulations on PPA Diversification Requirements

The IRS has released final regulations on the diversification requirements added by the Pension Protection Act of 2006 (PPA) for defined contribution plans holding publicly traded employer securities. The regulations apply for plan years beginning on or after January 1, 2011, but may be relied on immediately.

Source: Buck Consultants, June 2010.

PPA Makes Additional Changes to DC Plan Rules for 2008 and Beyond

This is a detailed overview of specific aspects of the 2006 pension reform legislation (PPA) affecting defined contribution plans that are effective in 2008 and beyond.

Source: Prudential Retirement, July 2007.

New Developments Regarding 'Investment Advice Arrangements' under PPA

As plan fiduciaries become acquainted with the new EIAA rules, it seems likely that more plans will elect to take advantage of such an arrangement, particularly since the cost of the arrangement may be paid from plan assets. As is generally the case with any decision subject to the standards of ERISA, however, care should be taken.

Source: Trucker Huss, May 2007.

Overview of the PPA

New rules for retirement plans, new plan design options, new plan requirements, and new fiduciary protection.

Source: Hay Group, November 2006.

PPA Signals a New Era for the Private Pension System

In August, with the signature of President Bush, the Pension Protection Act of 2006 (PPA) quietly became the most comprehensive pension reform package since ERISA was passed in 1974. Its significance cannot be overstated!

Source: 401khelpcenter.com, November 2006.

Some Lessor Provisions of the PPA

The media reporting around the defined contribution provisions in the Pension Protection Act of 2006 has focused on just a few key issues: advice, automatic enrollment and EGTRRA permanence. But there are over 30 other provisions. Here are a few highlights on other sections of the bill.

Source: 401khelpcenter.com, August 2006.

COMMENTARY: A Finance Professor's View on the PPA 2006

"The bill does not address either of the two issues that I regard as crucial to fixing what is wrong with the U.S. private pension system today. The first of these relates to the traditional defined benefit pension system and the federal government agency that insures it: the PBGC. The second relates to the emerging new pension system that is built around 401k, 403b, IRAs and other self-directed investment accounts."

Source: Benefitslink.com, August 2006.

Amendments to the Definition of Plan Assets

Section 611(f) of the Pension Protection Act of 2006 adds a definition of "plan assets" to ERISA, and as a result, significantly decreases the likelihood that an investment fund would be deemed to be holding "plan assets."

Source: White & Case LLP, August 2006.

PPA Sets New Prohibited Transaction Rules and ERISA Fidelity Bond Requirements

This Alert focuses on changes to the prohibited transaction restrictions of ERISA and the Internal Revenue Code of 1986 that affect investment advisers, broker-dealers, and others that provide financial services to plans (either directly or indirectly through entities whose assets are considered to include "plan assets" for ERISA purposes). This Alert also discusses changes to ERISA's fidelity bond requirements.

Source: Kirkpatrick & Lockhart Nicholson Graham LLP, August 2006.

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