Amendments to Safe Harbor for Distributions From Terminated Individual Retirement Account Plans

SUMMARY: This document contains a final rule amending regulations under the Employee Retirement Income Security Act of 1974 that provide guidance and a fiduciary safe harbor for the distribution of benefits on behalf of participants or beneficiaries in terminated and abandoned individual account plans. The Department is amending these regulations to reflect changes enacted as part of the Pension Protection Act of 2006 to the Internal Revenue Code of 1986 (the Code), under which a distribution of a deceased plan participant's benefit from an eligible retirement plan may be directly transferred to an individual retirement plan established on behalf of the designated nonspouse beneficiary of such participant. Specifically, the amended regulations require as a condition of relief under the fiduciary safe harbor that benefits for a missing, designated nonspouse beneficiary be directly rolled over to an individual retirement plan that fully complies with Code requirements. This final rule will affect fiduciaries, plan service providers, and participants and beneficiaries of individual account pension plans. DATES: This final rule is effective November 6, 2008.