[Code of Federal Regulations]
[Title 29, Volume 9]
[Revised as of July 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 29CFR4041A.25]

[Page 760-761]
 
                             TITLE 29--LABOR
 
                          GUARANTY CORPORATION
 
PART 4041A--TERMINATION OF MULTIEMPLOYER PLANS--Table of Contents
 
                     Subpart C--Plan Sponsor Duties
 
Sec. 4041A.25  Periodic determinations of plan solvency.

    (a) Annual insolvency determination. The plan sponsor of a plan that 
has been amended to eliminate all benefits that are subject to reduction 
under section 4281(c) of ERISA shall determine in writing whether the 
plan is expected to be insolvent for the first plan year beginning after 
the effective date of the amendment and for each plan year thereafter. 
In the event that a plan adopts more than one amendment reducing 
benefits under section 4281(c) of ERISA, the initial determination shall 
be made for the first plan year beginning after the effective date of 
the

[[Page 761]]

amendment that effects the elimination of all such benefits, and a 
determination shall be made for each plan year thereafter. The plan 
sponsor of a plan under which no benefits are subject to reduction under 
section 4281(c) of ERISA as of the date the plan terminated shall 
determine in writing whether the plan is expected to be insolvent. The 
initial determination shall be made for the second plan year beginning 
after the first plan year for which it is determined under section 
4281(b) of ERISA that the value of nonforfeitable benefits under the 
plan exceeds the value of the plan's assets. The plan sponsor shall also 
make a solvency determination for each plan year thereafter. A 
determination required under this paragraph shall be made no later than 
six months before the beginning of the plan year to which it applies.
    (b) Other determination of insolvency. Whether or not a prior 
determination of plan solvency has been made under paragraph (a) of this 
section (or under section 4245 of ERISA), a plan sponsor that has reason 
to believe, taking into account the plan's recent and anticipated 
financial experience, that the plan is or may be insolvent for the 
current or next plan year shall determine in writing whether the plan is 
expected to be insolvent for that plan year.
    (c) Benefit suspensions. If the plan sponsor determines that the 
plan is, or is expected to be, insolvent for a plan year, it shall 
suspend benefits in accordance with Sec. 4281.41.
    (d) Insolvency notices. If the plan sponsor determines that the plan 
is, or is expected to be, insolvent for a plan year, it shall issue 
notices of insolvency or annual updates and notices of insolvency 
benefit level of the PBGC and to plan participants and beneficiaries in 
accordance with part 4281, subpart D.