Final Pension Rules to Answer Questions About Market Rate of Return

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Employers that sponsor cash balance plans must wait until the Treasury Department and IRS issue final rules on a market rate of return to know whether that rate would be affected by recently adjusted segment rates for pension funding, an IRS actuary says. “The answer is, ‘we don't know what the answer is quite yet,' ” says IRS actuary Michael Spaid when asked how recently published 25-year average segment rates might affect a market rate of return used by hybrid defined benefit plans. Any final hybrid plan regulation on a market rate of return would not be effective before Jan. 1, 2013, Spaid says.

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