Law Dictionary

Pension Benefit Guaranty Corporation (PBGC)

(Tax Law)

The PBGC was created, when the �Employee Retirement Income Security Act (ERISA) of 1974� was enacted; Title IV of ERISA applies to the PBGC. The PBGC is a quasi-government federal agency that insures the pension benefits of working men and women in private sector defined benefit pension plans. A defined benefit pension plan that does not have enough money to pay benefits may be terminated if the employer responsible for the plan faces severe financial difficulty, such as bankruptcy, and is unable to maintain the plan. If the PBGC approves the termination, the PBGC then pays pension benefits under the terms of the plan, subject to legal limits, to plan participants and beneficiaries. PBGC pension benefit recipients are then potentially eligible for the HCTC.

Source : Internal Revenue Service - United States Department of Treasury

Language : English

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