Practice Quiz

CLEP Business Law

Category - Legal Envrmt

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What governmental agency will step in if a pension plan does not have sufficient assets to pay benefits?
  1. Department of Retiree Benefits
  2. Department of Justice
  3. Department of Labor
  4. Pension Benefit Guaranty Corporation
  5. Internal Revenue Service
Explanation
Answer: D. The governmental agency that will step in if a pension plan does not have sufficient assets to pay benefits is the Pension Benefit Guaranty Corporation (PBGC). Plan sponsors must pay premiums to the PBGC. The rates are calculated per participant. PBGC rules also require that plan sponsors abide by minimum funding standards.
Category: Legal Environment
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