ERISA News

The Internal Revenue Service (IRS) has issued Notice 2025-14, which contains updated guidance on factors used in certain defined benefit (DB) pension plan minimum funding and present value calculations. Updates include corporate bond monthly yield curve, the corresponding spot segment rates for January used under Internal Revenue Code Section (IRC Sec.) 417(e)(3), and the 24-month average segment rates for February under IRC Sec. 430(h)(2). IRC Sec. 417 contains definitions and special rules for minimum survivor annuity requirements in DB plans. IRC Sec. 430 addresses minimum funding standard for single-employer DB plans.

Representative Rob Wittman (R-VA) and several co-sponsors have introduced the Freedom to Invest in Tomorrow’s Workforce Act. According to a press release, the bill would permit the use of 529 account funds to pay for certain post-secondary training programs.

Representative Chip Roy (R-TX) and co-sponsors Andy Biggs (R-AZ) and Barry Moore (R-AL) have introduced the Direct Medical Care Freedom Act. According to a press release, the bill would ensure that direct primary care and direct specialty care is considered a qualified medical expense for health savings account purposes.

Senators Katie Britt (R-AL), Raphael Warnock (D-GA), Bill Cassidy (R-LA), and Gary Peters (D-MI), have introduced S.424, the Retirement Fairness for Charities and Educational Institutions Act.

The Internal Revenue Service (IRS) has issued a proposed regulation, providing guidance for employers that are required to include an automatic enrollment provision with their 401(k) or 403(b) plan in order to comply with the SECURE 2.0 Act of 2022 (SECURE 2.0).

Representatives Marie Gluesenkamp Perez (D-WA) and co-sponsor Chuck Edwards (R-NC) have introduced H.R. 808,

A proposed rule and class exemption issued by the Department of Labor’s Employee Benefits Security Administration providing guidance on ESOP transactions pursuant to SECURE 2.0 has been withdrawn from publication in the Federal Register pending further review pursuant to executive order. The proposal was aimed at implementing acceptable standards and procedures to establish good faith fair market value for shares to be acquired by an ESOP pursuant to SECURE 2.0. According to the order, the proposal will be reviewed by the agency in light of the change in administration.

The Internal Revenue Service has issued Notice 2025-13, which contains updated guidance on factors used in certain defined benefit (DB) pension plan minimum funding and present value calculations. Updates include corporate bond monthly yield curve, the corresponding spot segment rates for December used under Internal Revenue Code Section (IRC Sec.) 417(e)(3), and the 24-month average segment rates for January under IRC Sec. 430(h)(2). IRC Sec. 417 contains definitions and special rules for minimum survivor annuity requirements in DB plans. IRC Sec. 430 addresses minimum funding standard for single-employer DB plans.

The IRS has issued Revenue Ruling 2025-05, which contains the applicable federal rates (AFR) for February 2025. These rates are used for such purposes as calculating distributions from retirement savings arrangements that meet the requirements for substantially equal periodic payments (a 10 percent early distribution penalty tax exception), also referred to as “72(t) payments.”

The Department of Labor’s Employee Benefits Security Administration has issued a proposed rule and class exemption implementing acceptable standards and procedures to establish good faith for market value for shares to be acquired by an ESOP pursuant to SECURE 2.0. The proposal provides guidance governing the determination of fair market value in accordance with the definition of the term “adequate consideration” under ERISA as applied to certain ESOP transactions involving employer stock. Comments are due within 75 days of publication in the Federal Register.