Internal Revenue Code · 26 U.S.C.
§ 4980F. Failure of applicable plans reducing benefit accruals to satisfy notice requirements
Official text, no changes From the Office of the Law Revision Counsel, release point 119-121 (current through Public Law 119-121 (October 9, 2026)). Compare it with the official text at uscode.house.gov (external site).
Cite as 26 U.S.C. § 4980F
At a glance
Read from the text, the source credit and the official notes. Not part of the law.
- Status
- In force
- Added
- June 7, 2001 by Pub. L. 107–16
- Last amended
- August 17, 2006 by Pub. L. 109–280
- Amendments
- 2 dated changes in the source credit
- Length
- 7 subsections · 1,050 words · about 5 min to read
- Defines
- 3 terms
- Cross-references
- cites 7; cited by 1 Code section and 3 other regulations
- Regulations
- 1 issued under this section
For purposes of this section, the term “noncompliance period” means, with respect to any failure, the period beginning on the date the failure first occurs and ending on the date the notice to which the failure relates is provided or the failure is otherwise corrected.
No tax shall be imposed by subsection (a) on any failure during any period for which it is established to the satisfaction of the Secretary that any person subject to liability for the tax under subsection (d) did not know that the failure existed and exercised reasonable diligence to meet the requirements of subsection (e).
If the person subject to liability for tax under subsection (d) exercised reasonable diligence to meet the requirements of subsection (e), the tax imposed by subsection (a) for failures during the taxable year of the employer (or, in the case of a multiemployer plan, the taxable year of the trust forming part of the plan) shall not exceed $500,000. For purposes of the preceding sentence, all multiemployer plans of which the same trust forms a part shall be treated as 1 plan.
For purposes of this paragraph, if all persons who are treated as a single employer for purposes of this section do not have the same taxable year, the taxable years taken into account shall be determined under principles similar to the principles of section 1561.
In the case of a failure which is due to reasonable cause and not to willful neglect, the Secretary may waive part or all of the tax imposed by subsection (a) to the extent that the payment of such tax would be excessive or otherwise inequitable relative to the failure involved.
If an applicable pension plan is amended to provide for a significant reduction in the rate of future benefit accrual, the plan administrator shall provide the notice described in paragraph (2) to each applicable individual (and to each employee organization representing applicable individuals) and to each employer who has an obligation to contribute to the plan.
Except as provided in regulations, the notice required by paragraph (1) shall be provided within a reasonable time before the effective date of the plan amendment.
Any notice under paragraph (1) may be provided to a person designated, in writing, by the person to which it would otherwise be provided.
A plan shall not be treated as failing to meet the requirements of paragraph (1) merely because notice is provided before the adoption of the plan amendment if no material modification of the amendment occurs before the amendment is adopted.
A plan amendment which eliminates or reduces any early retirement benefit or retirement-type subsidy (within the meaning of section 411(d)(6)(B)(i)) shall be treated as having the effect of reducing the rate of future benefit accrual.
(Added Pub. L. 107–16, title VI, § 659(a)(1), June 7, 2001, 115 Stat. 137; amended Pub. L. 107–147, title IV, § 411(u)(1), Mar. 9, 2002, 116 Stat. 51; Pub. L. 109–280, title V, § 502(c)(2), Aug. 17, 2006, 120 Stat. 941.)
Terms defined here
Where the text says “the term … means”. Select a term to jump to its definition.
Regulations under this section
Treasury regulations (26 CFR) issued under § 4980F
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
This section cites 7 other sections
- § 1561 Limitation on accumulated earnings credit in the case of certain controlled corporations
- § 414(p)(8) Definitions and special rules
- § 401(a) Qualified pension, profit-sharing, and stock bonus plans
- § 501(a) Exemption from tax on corporations, certain trusts, etc.
- § 412 Minimum funding standards
- § 410(d) Minimum participation standards
- § 411(d)(6)(B)(i) Minimum vesting standards
Cited by 1 Code section
Cited in 3 regulations not issued under it
Amendment history
From the source credit and the official notes, newest first.
Where it sits in the Code
Nearby sections
- § 4980B Failure to satisfy continuation coverage requirements of group health plans
- § 4980C Requirements for issuers of qualified long-term care insurance contracts
- § 4980D Failure to meet certain group health plan requirements
- § 4980E Failure of employer to make comparable Archer MSA contributions
- § 4980F Failure of applicable plans reducing benefit accruals to satisfy notice requirements
- § 4980G Failure of employer to make comparable health savings account contributions
- § 4980H Shared responsibility for employers regarding health coverage
- § 4980I Repealed
Official notes
Show the Law Revision Counsel's notes (amendments, effective dates)
Editorial Notes
Amendments
2006—Subsec. (e)(1). Pub. L. 109–280 inserted “and to each employer who has an obligation to contribute to the plan” before period at end.
2002—Subsec. (e)(1). Pub. L. 107–147, § 411(u)(1)(A), substituted “the notice described in paragraph (2)” for “written notice”.
Subsec. (f)(2)(A). Pub. L. 107–147, § 411(u)(1)(B), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “any defined benefit plan, or”.
Subsec. (f)(3). Pub. L. 107–147, § 411(u)(1)(C), struck out “significantly” before “reduces” and before “reducing”.
Statutory Notes and Related Subsidiaries
Effective Date of 2006 Amendment
Pub. L. 109–280, title V, § 502(d), Aug. 17, 2006, 120 Stat. 941, provided that: “The amendments made by this section [amending this section and sections 1021, 1054, and 1132 of Title 29, Labor] shall apply to plan years beginning after December 31, 2007.”
Effective Date of 2002 Amendment
Amendment by Pub. L. 107–147 effective as if included in the provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001, Pub. L. 107–16, to which such amendment relates, see section 411(x) of Pub. L. 107–147, set out as a note under section 25B of this title.
Effective Date
Pub. L. 107–16, title VI, § 659(c), June 7, 2001, 115 Stat. 141, as amended by Pub. L. 107–147, title IV, § 411(u)(3), Mar. 9, 2002, 116 Stat. 52, provided that:
“(1) In general.— The amendments made by this section [enacting this section and amending section 1054 of Title 29, Labor] shall apply to plan amendments taking effect on or after the date of the enactment of this Act [June 7, 2001].“(2) Transition.— Until such time as the Secretary of the Treasury issues regulations under sections 4980F(e)(2) and (3) of the Internal Revenue Code of 1986, and section 204(h) of the Employee Retirement Income Security Act of 1974 [29 U.S.C. 1054(h)], as added by the amendments made by this section, a plan shall be treated as meeting the requirements of such sections if it makes a good faith effort to comply with such requirements.“(3) Special notice rule.—“(A) In general.— The period for providing any notice required by the amendments made by this section shall not end before the date which is 3 months after the date of the enactment of this Act.“(B) Reasonable notice.— The amendments made by this section shall not apply to any plan amendment taking effect on or after the date of the enactment of this Act if, before April 25, 2001, notice was provided to participants and beneficiaries adversely affected by the plan amendment (and their representatives) which was reasonably expected to notify them of the nature and effective date of the plan amendment.”