Please note: As of January 20, 2021, information in some news releases may be out of date or not reflect current policies.
News Release
PWBA Requests Input on Safe Harbors For Automatic Rollovers
Archived News Release — Caution: Information may be out of date.
Washington, DC - The U.S. Department of Labor’s Pension and Welfare Benefits Administration today published a request in the Federal Register soliciting information from the public to assist in the development of “safe harbors” for plan administrators to follow regarding automatic rollovers of plan distributions of $5,000 or less.
Passed in President Bush’s Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), the automatic rollover provisions promote retirement savings by preserving workers’ retirement funds for retirement purposes rather than having them cashed out as taxable distributions.
When participants change jobs or leave the workforce, they have the opportunity to rollover their assets to an Individual Retirement Account (IRA) or other qualified plan, or receive a taxable cash distribution. In the absence of an election by a participant, the safe harbor provisions will allow plan administrators to satisfy their fiduciary responsibilities under ERISA when they rollover participants’ balances between $1,000 to $5,000 into certain IRAs or annuities.
The department is requesting information to be submitted within 60 days, or no later than March 10, 2003. Interested parties are encouraged to review the Request for Information (RFI) for further details.
Details of the RFI can be found on the agency’s website at www.dol.gov/pwba under Laws and Regulations. Written or electronic responses should be submitted to the Department of Labor on or before March 10. They should be addressed to the Office of Regulations and Interpretations, Pension and Welfare Benefits Administration, Room N-5669, U.S. Department of Labor, Washington, DC 20210, Attention: Automatic Rollover RFI. Electronic responses should contain “Automatic Rollover RFI” on the subject line and addressed to e-ORI@pwba.dol.gov.
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Archived News Release — Caution: Information may be out of date.