Allocation of Assets in Single-Employer Plans; Interest Assumptions for Valuing Benefits
AI-generated summary for informational purposes only. Not legal advice. See the original source for the authoritative text.
This final rule from the Pension Benefit Guaranty Corporation (PBGC) updates the interest assumptions in 29 CFR Part 4044 for valuing benefits in terminating single-employer pension plans. It prescribes specific 'spreads'—adjustments to bond yield curves—for the second quarter of 2026 (April 30 to July 30, 2026), ensuring the 4044 yield curve aligns with private-sector group annuity prices. These spreads are published quarterly based on annuity pricing surveys and are used in plan terminations, withdrawal liability calculations, and other PBGC-regulated scenarios like mass withdrawals or special financial assistance. The rule revises Table 1 in §4044.54(e)(3) to include spreads for Q3 2025 through Q2 2026, with values ranging from 0.63% at 0.5-year maturity to -0.10% at 30 years for Q2 2026. PBGC bypassed public comment as these technical updates are routine, necessary for timely alignment with market data, and effective immediately upon April 30, 2026 publication. These assumptions also apply beyond terminations, such as in multiemployer plan withdrawal liabilities (29 CFR parts 4219, 4281, 4262), annual reporting (part 4010), and missing participants transfers (part 4050), promoting consistency in pension liability valuations.
AI-generated summary. May contain errors. Refer to official sources for legal decisions.
Key Changes
- Amends 29 CFR §4044.54(e)(3) Table 1 with Q2 2026 spreads effective April 30, 2026
- Sets spreads from 0.63% at 0.5-year maturity to -0.10% at 30-year maturity for April-July 2026 valuations
- Updates prior quarters: Q1 2026 up to 0.56%, Q4 2025 up to 0.49%, Q3 2025 up to 0.40%
+ 3 more changes with Pro
Obligations
What this law requires
Plan sponsors and administrators must use the Q2 2026 spreads specified in Table 1 of §4044.54(e)(3) to calculate the 4044 yield curve for valuing benefits in single-employer plans with valuation dates between April 30, 2026 and July 30, 2026
Plan sponsors must apply the prescribed spreads (ranging from 0.63% at 0.5-year maturity to -0.10% at 30 years for Q2 2026) to determine the present value of annuities in involuntary or distress terminations of single-employer plans
Multiemployer plan sponsors must use the interest assumptions from part 4044 to value liabilities for determining withdrawn employers' reallocation liability in the event of a mass withdrawal
Plan sponsors receiving special financial assistance under 29 CFR part 4262 must use the interest assumption from part 4044 to determine withdrawal liability for the prescribed assistance period
Plan sponsors must use the part 4044 interest assumptions when reporting benefit liabilities in filings required under 29 CFR part 4010 (Annual Financial and Actuarial Information Reporting)