Benefits Counselor - June 2026

RETIREMENT PLAN UPDATES

Supreme Court Resolves Withdrawal Liability Circuit Split

In M&K Employee Solutions v. Trustees of the IAM National Pension Fund, the Supreme Court of the United States resolved a split among the federal courts of appeals regarding withdrawal liability. The Court held that ERISA does not require a multiemployer pension plan to use actuarial assumptions in effect on or before the measurement date—the last day of the plan year preceding an employer’s withdrawal—when calculating withdrawal liability. A key actuarial assumption in calculating withdrawal liability is the discount rate, which is the interest rate used to determine the present value of future benefit payments. In this case, four employers withdrew from a multiemployer pension plan in 2018. The plan’s actuary applied a 6.5 percent discount rate adopted in January 2018. The employers argued that the plan should instead have used the 7.5 percent rate in effect as of the December 31, 2017, measurement date. The Court rejected the employers’ argument, concluding that plan actuaries must use assumptions that are reasonable and reflect the actuary’s best estimate of anticipated experience. The actuary is not required to use assumptions that were in effect as of the measurement date.

EBSA Provides Good Faith Enforcement Relief for Paper Pension Statement Requirements

On May 12, 2026, the U.S. Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) announced a temporary enforcement policy for SECURE 2.0’s paper pension benefit statement requirements. Under this policy, the DOL will not take action against plan administrators who make good-faith efforts to comply with these requirements. This relief applies where compliance is based on a reasonable interpretation of the statute or the February 25, 2026, proposed rules.

IRS Notice Provides Guidance on Qualified Long-Term Care Distributions

On May 20, 2026, the Internal Revenue Service (IRS) issued guidance in Notice 2026-33 on qualified long term care distributions as enacted by the SECURE 2.0 Act. This provision permits eligible retirement plans to distribute funds to cover long-term care insurance premiums without triggering the 10 percent early distribution penalty.

For plan administrators, the guidance provides that:

• Defined contribution plans must be amended to permit such distributions.
• The deadline to amend a plan to permit qualified long-term care distributions is extended to December 31, 2027.
• Plan administrators may rely on an insurer’s long-term care premium statements in making these distributions without risking the plan’s tax qualified status.

The guidance applies to distributions made after December 29, 2025.

SEC Statement Answers Outstanding Pooled Employer Plan Questions

On May 4, 2026, the Securities and Exchange Commission (SEC) issued a statement on pooled employer plans (PEPs), aligning its guidance on PEPs with the SECURE Act’s goal of promoting multiple employer plans. The statement clarifies that:

• PEPs may be treated as single-employer plans for purposes of Section 3(c)(11) of the Investment Company Act of 1940 (the ’40 Act). As a result, PEPs, like other employee benefit plans, are not subject to registration or regulation as investment companies under the ’40 Act.
• PEPs may admit additional employers without losing eligibility to invest in collective investment trusts (CITs).

Eight Circuit Dismisses Complaint Alleging Fiduciary Breach for Failure to Properly Use Plan’s Forfeiture Account

In Matula v. Wells Fargo & Co., the U.S. Court of Appeals for the Eighth Circuit dismissed a class action brought by plan participants alleging that Wells Fargo improperly used forfeited 401(k) funds because the plaintiffs lacked Article III standing. To establish Article III standing, a plaintiff must allege a concrete, particularized injury. Here, the plaintiffs alleged only injury to the plan itself—not to their individual accounts—and therefore lacked standing to challenge the plan’s use of forfeitures. This is the first federal appellate decision to address the issue amid a wave of class actions challenging how plan administrators use forfeiture accounts. The decision is consistent with the weight of district court authority, which has largely favored plan administrators.

PBGC Updates Guidance on Defined Benefit Plan Mergers Involving SFA Funds

On May 13, 2026, the Pension Benefit Guaranty Corporation (PBGC) updated and expanded its FAQs addressing the treatment of mergers involving plans that received Special Financial Assistance (SFA). The updated guidance generally affirms prior positions but adds details for treatment of SFA Funds including related withdrawal liability, benefit and contribution concerns.

IRS Publishes 2026 Cumulative List of Qualification Requirement Changes for Pre Approved Defined Benefit Plans

On May 14, 2026, IRS published Notice 2026-34, which sets forth the provisions that defined benefit plans must include receiving an IRS opinion letter under the IRS’s pre-approved plan program. Most of the changes reflect amendments to the Internal Revenue Code made by the SECURE 2.0 Act.

PBGC Announces New Amicus Brief Program

On May 7, 2026, PBGC announced a new amicus brief program. Under the program, plan sponsors may request that the agency file amicus briefs in cases affecting PBGC or the broader private pension system. The program focuses on cases in the U.S. Courts of Appeals and the U.S. Supreme Court.

HEALTH AND WELFARE PLAN UPDATES

Labor, HHS, Treasury Announce Propose Rule to Expand Fertility Benefit Access

On May 10, 2026, the DOL, Health and Human Services and the Treasury (collectively, the Departments) announced a proposed rule permitting employers to offer certain fertility benefits as a new category of limited excepted benefits. These benefits will not be subject to market reform requirements, including under HIPAA, the Affordable Care Act and the No Surprises Act.

Under the proposed rule, to qualify as a limited excepted benefit, the fertility benefit must:

• If insured, be provided under a separate policy, certificate or contract of insurance;
• If self-insured, be offered only to employees (and dependents, if eligible for fertility benefits) eligible to participate in the employer’s traditional group health plan;
• Provide that substantially all benefits relate to the diagnosis, mitigation or treatment of infertility or related reproductive health conditions;
• Be subject to a combined lifetime maximum of up to $120,000 for the participant and any eligible dependents (indexed for inflation); and
• Include a notice that functions as an executive summary or quick reference guide to the benefit, to be provided at initial eligibility, annually and upon requested.

As drafted, the rule would go into effect for plan years beginning on or after January 1, 2027.

COMPLIANCE DEADLINES AND REMINDERS

General

Form 5500 for Calendar Year Plans: Plan administrators generally must file Form 5500 within seven months after the end of the plan year, including applicable schedules and attachments. Accordingly, for plan years ending on December 31, 2025, the Form 5500 filing deadline is July 31, 2026. A plan administrator may apply for a deadline extension by filing Form 5558 (Application for Extension of Time) on or before July 31, 2026.

Summary of Material Modifications for Calendar Year Plans: Summaries of Material Modifications (SMMs) must be distributed within 210 days after the end of the plan year in which the substantial modification was adopted. Thus, for calendar year plans, all SMMs describing amendments made during the 2025 plan year must be distributed by July 29, 2026.

Health and Welfare Plans

PCORI Fee Due July 31, 2026: Plan sponsors of self-insured group health plans must report and pay the annual Patient-Centered Outcomes Research Institute (PCORI) fee to the IRS by filing IRS Form 720 (Quarterly Federal Excise Tax Return) for the second quarter, due July 31, 2026. The PCORI fee is based on the average number of covered lives under the plan. For plan years ending on or after October 1, 2024, and before October 1, 2025, the applicable fee is $3.47 per covered life. For plan years ending on or after October 1, 2025, and before October 1, 2026, the applicable fee is $3.84 per covered life.

Retirement Plans

Annual Funding Notice for Certain Defined Benefit Plans: Plan administrators of defined benefit plans with 100 or fewer participants on each day during the prior plan year generally must provide the annual funding notice to required recipients by the Form 5500 filing deadline, including extensions.

Form 8955 SSA: As with Form 5500, plan administrators must file Form 8955 SSA within seven months after the end of a plan year (i.e., July 31, 2026, for calendar year plans). A plan administrator can receive the same extension for Form 8955 SSA as is available for Form 5500 by filing Form 5558 on or before July 31, 2026. Plan administrators must also provide individual statements to those separated participants identified on Form 8955 SSA prior to the Form 8955 SSA filing deadline.

Periodic Pension Benefit Statements for Calendar Year Defined Contribution Plans: For calendar year defined contribution plans with participant directed investments, pension benefit statements must be provided by August 14, 2026. Calendar year plans without participant-directed investments must provide pension benefit statements on or before the date the Form 5500 is filed, but no later than July 31, 2026 (unless the Form 5500 deadline is extended).

Multiemployer Plan Summary Report: Plan administrators of multiemployer retirement plans must furnish participating unions and contributing employers with a report containing specified plan information—including contribution schedules, benefit formulas and the number of employers and participants—within 30 days after the Form 5500 filing deadline, including extensions.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.