Overview
Title
Agency Information Collection Activities; Submission for OMB Review; Comment Request; Measurement of Assets and Liabilities for Pension Funding Purposes
Agencies
ELI5 AI
The government needs to collect some information to make sure companies have enough money saved up for people's pensions (money given to people when they stop working). They want people to tell them what they think about this and how much work it will take.
Summary AI
The Department of the Treasury has announced its intention to submit a collection of information requests regarding pension funding to the Office of Management and Budget (OMB). These requests, involving revisions to current collections to align with statutory provisions and new laws, require public comment by February 25, 2021. The information collected will help plan sponsors and actuaries with aspects of funding obligations, such as using alternative interest rates or dealing with adjusted funding targets. This process involves various stakeholders including individuals, businesses, non-profits, and governments, with a significant estimated annual burden in terms of time commitment.
Abstract
The Department of the Treasury will submit the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, on or after the date of publication of this notice. The public is invited to submit comments on these requests.
Keywords AI
Sources
AnalysisAI
The document in question, published by the Department of the Treasury, outlines the submission of information collection requests related to pension funding, to be reviewed by the Office of Management and Budget (OMB). These collections are prompted by statutory sections of the IRS Code and recent legislative updates, and interested parties are encouraged to comment by February 25, 2021.
General Summary
The notice aims to collect data to assist plan sponsors and actuaries in navigating pension funding requirements, particularly under the updates brought by laws such as the CARES Act and the SECURE Act. The process will involve the gathering and utilization of information such as alternative interest rates and funding target percentages to fulfill regulatory demands.
Significant Issues or Concerns
There are several technical aspects and references to specific sections of the IRS Code, making the document potentially challenging for those unfamiliar with such legal nuances. The complexity may hinder public understanding and engagement with the comment process. Furthermore, the scale of the request—with an estimated 81,020 respondents and an annual burden of 121,080 hours—raises questions about the administrative feasibility and efficiency. There is a lack of clear financial impact information, which could be crucial for stakeholders to evaluate the cost-benefit ratio of compliance. Moreover, while the reasons for collecting this data are implied, the document could better articulate its necessity and the benefits it aims to provide.
Broad Public Impact
For the general public, especially those holding or expecting pension benefits, understanding these regulatory updates is critical, as they can indirectly affect retirement funding stability and security. However, the document's complexity might lead to confusion or disengagement from affected individuals.
Impact on Specific Stakeholders
For businesses, not-for-profits, and government entities, these collections signify additional compliance requirements that could entail substantial time investment and operational adjustments. While these processes aim to ensure robust pension funding practices, they could pose administrative and financial challenges, particularly for smaller organizations with limited resources. Conversely, for actuaries and pension plan sponsors, the guidelines could provide clearer directions for aligning with legislative changes and optimizing plan management strategies.
In summary, while the document addresses important regulatory objectives, its execution and communication could be improved to better serve public comprehension and facilitate practical implementation. Additionally, it calls for a balanced assessment of the administrative burden against the intended benefits of enhanced pension funding regulation.
Issues
• The document includes specialized terms and references to sections of the Code, IRS guidelines, and public laws, which may be difficult for a layperson to understand.
• The notice anticipates a significant number of respondents (81,020), which raises questions about the administrative burden and whether such a large response is necessary.
• The estimated total annual burden hours (121,080 hours) might indicate a substantial workload for plan sponsors, requiring scrutiny of whether this is reasonable.
• The document does not provide explicit cost estimates or a potential range of financial impacts for organizations and individuals involved, which limits the ability to assess financial implications.
• The language around the benefits and necessity of the information collection and reporting requirements could be clearer to justify the need for compliance.
• The document specifies regulations and amendments across different acts (CARES Act, SECURE Act), yet it could consolidate and clarify the implications of these changes in a simpler manner.