The Pension Benefit Guaranty Corporation (PBGC) has relaunched its Opinion Letter Program to provide enhanced compliance guidance under Title IV of ERISA. Employers, plan sponsors, unions, and practitioners can request opinion letters to clarify PBGC’s application of ERISA regulations to specific situations. Such requests will be reviewed, and any opinions issued by PBGC’s Office of the General Counsel.
For employers and plan sponsors, the relaunch of PBGC’s Opinion Letter Program provides an important mechanism to obtain guidance on particular fact patterns. However, the PBGC will not issue opinion letters for use in any investigation or litigation matter that existed before the request was submitted, nor will it issue opinion letters on coverage determination matters, individual benefit determinations, or issues addressed in a pending rulemaking. As with opinion letters offered by other regulatory agencies, only the entity requesting the opinion letter can rely on it.
On June 15, 2026, PBGC issued its first opinion letter under its relaunched program. The opinion addresses whether a plan sponsor’s reporting obligation would be triggered by an annuity buyout of more than 70% of the frozen plan’s actively employed participants. Ordinarily, under section 4043 of ERISA and the accompanying regulations, a plan sponsor must report a 20% or greater reduction in the number of actively employed plan participants in a single year. In its first opinion letter since 2002, PBGC advised that an annuity purchase for actively employed participants in a frozen defined benefit plan is “not the type of event that the statute or regulation were designed to capture” and that such a transaction does not, by itself, signal financial issues with a plan or plan sponsor. Therefore, no reporting would be necessary.
Plan sponsors should consider using the PBGC opinion letter process to help clarify their obligations and reduce regulatory risk, especially when confronting novel or complex issues that fall under PBGC’s jurisdiction (Title IV of ERISA). While a request can be made on a no-name basis, it must still be signed by counsel or an authorized representative.