Talk:Employee Retirement Income Security Act of 1974/Archives/2016

Assessment comment

The comment(s) below were originally left at Talk:Employee Retirement Income Security Act of 1974/Archives/Comments, and are posted here for posterity. Following several discussions in past years, these subpages are now deprecated. The comments may be irrelevant or outdated; if so, please feel free to remove this section.

==WP Tax Class== Start class. Should go higher to B class, but someone has to agree with me. Further, the article lacks references. With more references it could go to Good Article, but it also needs expansion into history and impact including cultural impact.EECavazos 18:46, 7 November 2007 (UTC) ==WP Tax Class== Mid priority because important law with great tax consequences within a country.EECavazos 18:47, 7 November 2007 (UTC)

Last edited at 18:47, 7 November 2007 (UTC). Substituted at 14:28, 29 April 2016 (UTC)

Target benefit and money purchase plans not fully funded?

Can somebody verify this addition[1]? I don't know anything about money purchase plans, but based on the little bit I know about target benefit plans, I think it's wrong; I think they are always fully funded. Thank you. — Malik Shabazz ^Talk/_Stalk 21:19, 15 January 2014 (UTC)

I've had this article on my long-term to-do list, but didn't intend to actually do anything just yet. Then I noticed that you recently responded to a reader comment and thought that this might be a good time to address your question, as well.

ERISA's funding rules didn't view the universe as defined benefit vs. defined contribution. Instead, it viewed it as pension vs. other-than-pension. The reason that money purchase plans (of which target benefit plans are a special case) are subject to ERISA's funding requirements is simply that they had been viewed as "pension" plans since the early days of pensions in the U.S.

As to your statement that money purchase plans are always fully-funded, that typically is true. But there are two instances where they might not be. First, a sponsor who is unable to make a required contribution to the plan might apply for a governmental "waiver" of that year's requirement. However, that waiver does not absolve the sponsor from making the contribution. It merely "refinances" the missed contribution so as to be paid in installments over the next several years. Until those installments are fully paid, the plan is not considered to be fully-funded. The second (and much more rare) instance has to do with a pre-ERISA plan design that was never very popular and, as far as I know, pretty much extinct today -- that of establishing past-service credits for existing employees when a money purchase plan was established. Until the liability for those past-service credits was paid off, the plan was not "fully funded".

I hope this was helpful. NewYorkActuary (talk) 22:56, 18 June 2016 (UTC)

Yes, it was. Thank you, and thank you for your other helpful edits to actuarial articles. — Malik Shabazz ^Talk/_Stalk 23:05, 18 June 2016 (UTC)

Reader Comment

The first sentence of the second paragraph in the History section is very worldly. It may be more effective to split into two or three sentences. — Preceding unsigned comment added by 172.56.29.227 (talk) 19:23, 18 June 2016 (UTC)

Thank you for your comment. I've edited the sentence, which was over-long and hard to follow, into two sentences. I hope it's easier to read now. Thanks again. — Malik Shabazz ^Talk/_Stalk 22:15, 18 June 2016 (UTC)