On January 24, 2002, one day after President Bush signed into law the Victims of Terrorism Tax Relief Act, the Internal Revenue Service (IRS) published Notice 2002-7, which details the relief under the Act being given to defined benefit plans affected by the September 11 terrorist attacks. The relief provided by the Notice applies for compliance with ERISA as well as the Internal Revenue Code. (Notice 2002-7 is scheduled to appear in Internal Revenue Bulletin 2002-6, dated February 11, 2002, which will be available on the IRS Web site).

Extension for Complying with the Minimum Funding Standards

If the dates for making contributions required by the minimum funding rules of ERISA fell within the period from September 11, 2001 through February 11, 2002, the legal deadline for making those contributions is postponed to February 12, 2002. All of the obligations and deadlines that relate to the minimum funding requirement, including special rules that come into play when there is a significant underfunding, are similarly postponed. Contributions made by the extended deadlines can be counted as plan assets for determining whether a single employer plan owes PBGC variable premiums and, if so, how much is owed.

This relief under Notice 2002-7 applies to plans directly affected by the terrorist acts of September 11. The following entities are included if they are located in the five boroughs of New York City:

• The principal places of business of any employer maintaining the plan,
• The office of the plan or plan administrator,
• The office of the primary recordkeeper, and
• The office of an attorney, enrolled actuary, CPA, or other advisor retained by the plan.

Extension for Waiver Application Deadlines

If the dates for applying for a waiver fell between March 15, 2001 and February 28, 2002, the date such waiver must be applied for is postponed to March 1, 2002. This extension applies to all plans, not just the plans in New York City.

Compliance Alert, The Segal Company’s periodic electronic newsletter summarizing important developments affecting benefit plan compliance, is for informational purposes only. It is not intended to provide authoritative guidance. On all issues involving the interpretation or application of laws and regulations, plan sponsors should rely on their attorneys for legal advice.

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