Post-PPA Funding Rules for Money Purchase Plans

[J. Bringhurst]

For a client, we are trying to confirm the post-PPA timing rules for employer contributions under a money purchase pension plan since IRC 412©(10)(B) has been eliminated. We looked up the chapter on defined benefit funding rules in "RIA's Complete Analysis of the Pension Protection Act of 2006" and found some interesting observations. Basically, the "minimum funding standard account" under IRC 412(b) was eliminated under the PPA. Because the minimum funding standard account was eliminated, it appears as if the timing rules that applied to the minimum funding standard account were also eliminated. Accordingly, the only timing rules that remain with regard to employer contributions under money purchase pension plans are those under IRC 404 (i.e., not later than the time prescribed by law for filing the return for such taxable year) [iRC 404(a)(6)].

We weren't able to find any other commentary or discussions on this out there, so I was hoping someone else out there had some insight or could confirm. Thanks in advance!

[Guest WJW]

We reached the same conclusions some time ago. Can't say that I've seen anything from Treasury or the Service calling attention to this.