The Pension Benefit Guaranty Corporation (PBGC) has updated a variety of interest rates for the first quarter of 2022 and for periods early in the year.
Variable Rate Premiums
Variable Rate Premiums are used to determine the premium funding target—that is, the present value of vested benefits—for variable-rate premium purposes unless the plan has an election in effect to use the alternative premium funding target.
For Premium Payment Years Beginning in 2022, Small Plans Using the Lookback Rule
| Month | Based on Spot Segments for | Spot Segment Rates, First | Spot Segment Rates, Second | Spot Segment Rates, Third |
| January 2022 | December 2020 | 0.51% | 2.26% | 3.01% |
| February 2022 | January 2021 | 0.50% | 2.38% | 3.17% |
| March 2022 | February 2021 | 0.51% | 2.54% | 3.45% |
For Premium Payment Years Beginning in March 2022, All Other Plans
| Month | Based on Spot Segments for | Spot Segment Rates, First | Spot Segment Rates, Second | Spot Segment Rates, Third |
| January 2022 | December 2021 | 1.16% | 2.72% | 3.10% |
| February 2022 | January 2022 | 1.41% | 3.02% | 3.36% |
| March 2022 | February 2022 | 1.88% | 3.35% | 3.70% |
ERISA 4044 Annuities
ERISA 4044 Annuities are used for determining the present value of annuities for involuntary or distress terminations of single-employer plans, as well as valuing benefits under multiemployer plans following a mass withdrawal.
| For Valuation Dates: |
it |
for t = | it | for t = |
| January-March 2022 | 0.0237 | 1-20 | 0.0203 | >20 |
| April -June 2022 | 0.0240 | 1-20 | 0.0212 | >20 |
Late Premium Payment Interest Charges
Late Premium Payment Interest Charges are used to determine the amount of interest PBGC assesses on late PBGC premiums.
| Period | Interest Rate |
| Jan. 1, 2022 – March 31, 2022 | 3% |
| April 1, 2022 – June 30, 2022 | 4% |
Late or Defaulted Withdrawal Liability
Late or Defaulted Withdrawal Liability. Unless rules adopted by the plan provide otherwise, these rates are used by multiemployer plans to charge withdrawn employers if their withdrawal liability payments are late or in default.
| From | To | Date of Quotation | Rate |
| Jan. 1, 2022 | March 31, 2022 | Dec. 15, 2021 | 3.25% |
| April 1, 2022 | June 30, 2022 | March 15, 2022 | 3.25% |
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