29 U.S. Code § 1421 - Reorganization status
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(a) Reorganization index of plan for plan year greater than zero
A multiemployer plan is in reorganization for a plan year if the plan’s reorganization index for that year is greater than zero.
(b) Determination of reorganization index of plan for plan year; applicable factors, definitions, etc.
(1) A plan’s reorganization index for any plan year is the excess of—
(2) For purposes of this part, the net charge to the funding standard account for any plan year is the excess (if any) of—
(A) the charges to the funding standard account for such year under section 412 (b)(2)  of title 26, over
(3) For purposes of this part, the vested benefits charge for any plan year is the amount which would be necessary to amortize the plan’s unfunded vested benefits as of the end of the base plan year in equal annual installments—
(A) The vested benefits charge for a plan year shall be based on an actuarial valuation of the plan as of the end of the base plan year, adjusted to reflect—
(I) decrease of 5 percent or more in the value of plan assets, or increase of 5 percent or more in the number of persons in pay status, during the period beginning on the first day of the plan year following the base plan year and ending on the adjustment date, or
(ii) any change in benefits under the plan which is not otherwise taken into account under this subparagraph and which is pursuant to any amendment—
(i) In determining the vested benefits charge for a plan year following a plan year in which the plan was not in reorganization, any change in benefits which—
(I) results from the changing of a group of participants from one benefit level to another benefit level under a schedule of plan benefits as a result of changes in a collective bargaining agreement, or
shall not be taken into account except to the extent provided in regulations prescribed by the Secretary of the Treasury.
(ii) Except as otherwise determined by the Secretary of the Treasury, in determining the vested benefits charge for any plan year following any plan year in which the plan was in reorganization, any change in benefits—
(II) described in clause (i)(II) as determined under regulations prescribed by the Secretary of the Treasury,
shall, for purposes of subparagraph (A)(ii), be treated as a change in benefits pursuant to an amendment to a plan.
(A) For purposes of this part, the base plan year for any plan year is—
(i) if there is a relevant collective bargaining agreement, the last plan year ending at least 6 months before the relevant effective date, or
(B) For purposes of this part, a relevant collective bargaining agreement is a collective bargaining agreement—
(C) For purposes of this part, the relevant effective date is the earliest of the effective dates for the relevant collective bargaining agreements.
(6) For purposes of this part, the term “person in pay status” means—
(A) a participant or beneficiary on the last day of the base plan year who, at any time during such year, was paid an early, late, normal, or disability retirement benefit (or a death benefit related to a retirement benefit), and
(7) For purposes of paragraph (3)—
(A) in determining the plan’s unfunded vested benefits, plan assets shall first be allocated to the vested benefits attributable to persons in pay status, and
(B) the vested benefits charge shall be determined without regard to reductions in accrued benefits under section 1425 of this title which are first effective in the plan year.
(8) For purposes of this part, any outstanding claim for withdrawal liability shall not be considered a plan asset, except as otherwise provided in regulations prescribed by the Secretary of the Treasury.
(9) For purposes of this part, the term “unfunded vested benefits” means with respect to a plan, an amount (determined in accordance with regulations prescribed by the Secretary of the Treasury) equal to—
(c) Payment of benefits to participants
Except as provided in regulations prescribed by the corporation, while a plan is in reorganization a benefit with respect to a participant (other than a death benefit) which is attributable to employer contributions and which has a value of more than $1,750 may not be paid in a form other than an annuity which (by itself or in combination with social security, railroad retirement, or workers’ compensation benefits) provides substantially level payments over the life of the participant.
(d) Terminated multiemployer plans
 See References in Text note below.
Source(Pub. L. 93–406, title IV, § 4241, as added Pub. L. 96–364, title I, § 104(2),Sept. 26, 1980, 94 Stat. 1249; amended Pub. L. 101–239, title VII, § 7891(a)(1),Dec. 19, 1989, 103 Stat. 2445.)
References in Text
Section 412, referred to in subsec. (b)(2), was amended generally by Pub. L. 109–280, title I, § 111(a),Aug. 17, 2006, 120 Stat. 820, and as so amended, section 412 no longer contains a subsec. (b)(3)(B) andsection 412 (b)(2) no longer relates to charges to the funding standard account.
1989—Subsec. (b)(2)(A). Pub. L. 101–239substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text.
Effective Date of 1989 Amendment
Amendment by Pub. L. 101–239effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 7891(f) ofPub. L. 101–239, set out as a note under section 1002 of this title.
Part, relating to multiemployer plan reorganization, effective, with respect to each plan, on the first day of the first plan year beginning on or after the earlier of the date on which the last collective-bargaining agreement providing for employer contributions under the plan, which was in effect on Sept. 26, 1980, expires, without regard to extensions agreed to after Sept. 26, 1980, or three years after Sept. 26, 1980, see section 1461 (e)(3) of this title.