The Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) includes a provision that provides welcome relief to sponsors of pension plans in the family-owned, non-publicly traded independent community newspaper industry. While such plans represent only a small segment of the retirement plan network, some note that issues within the industry are a reflection of funding issues faced on an annual basis by many pension plan sponsors.
For instance, sponsors of defined benefit pension plans are required to make contributions based on the presumed future assets and liabilities of the plan, calculated on the basis of certain actuarial assumptions. Under the new provisions of the SECURE Act, community newspaper pension plans are permitted to increase the assumed interest rate used to calculate their funding obligations from 7% to 8%. In conjunction, the legislation also provides an extension of the shortfall amortization period from seven years to 30 years, though the change is only allowed for plans that have no increases in accrued benefits after December 31, 2017.
Interested in learning more about the SECURE Act? Download the SECURE Act eBook from the Schneider Downs Retirement Solutions team for a full overview of provisions and highlights at www.schneiderdowns.com/secure-act-ebook.
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Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.