29 U.S.C. § 1405 Limitation On Withdrawal Liability

• Library: United States Statutes
• Edition: 2023
• Currency: Current through P.L. 118-34 (published on www.congress.gov on 12/26/2023), except for [P. L. 118-31]
• Year: 2023
• Citation: 29 U.S.C. § 1405

(a) Unfunded vested benefits allocable to employer in bona fide sale of assets of employer in arms-length transaction to unrelated party; maximum amount; determinative factors

(1) In the case of bona fide sale of all or substantially all of the employer's assets in an arm's-length transaction to an unrelated party (within the meaning of section 1384(d) of this title), the unfunded vested benefits allocable to an employer (after the application of all sections of this part having a lower number designation than this section), other than an employer undergoing reorganization under title 11 or similar provisions of State law, shall not exceed the greater of-

(A) a portion (determined under paragraph (2)) of the liquidation or dissolution value of the employer (determined after the sale or exchange of such assets), or

(B) in the case of a plan using the attributable method of allocating withdrawal liability, the unfunded vested benefits attributable to employees of the employer.

(2) For purposes of paragraph (1), the portion shall be determined in accordance with the following table:

<TABLE> <TR> <TD>If the liquidation or distribution value of the employer after the sale or exchange is-</TD> <TD>The portion is-</TD> </TR> <TR> <TD>Not more than $5,000,000</TD> <TD>30 percent of the amount.</TD> </TR> <TR> <TD>More than $5,000,000, but not more than $10,000,000</TD> <TD>$1,500,000, plus 35 percent of the amount in excess of $5,000,000.</TD> </TR> <TR> <TD>More than $10,000,000, but not more than $15,000,000</TD> <TD>$3,250,000, plus 40 percent of the amount in excess of $10,000,000.</TD> </TR> <TR> <TD>More than $15,000,000, but not more than $17,500,000</TD> <TD>$5,250,000, plus 45 percent of the amount in excess of $15,000,000.</TD> </TR> <TR> <TD>More than $17,500,000, but not more than $20,000,000</TD> <TD>$6,375,000, plus 50 percent of the amount in excess of $17,500,000.</TD> </TR> <TR> <TD>More than $20,000,000, but not more than $22,500,000</TD> <TD>$7,625,000, plus 60 percent of the amount in excess of $20,000,000.</TD> </TR> <TR> <TD>More than $22,500,000, but not more than $25,000,000</TD> <TD>$9,125,000, plus 70 percent of the amount in excess of $22,500,000.</TD> </TR> <TR> <TD>More than $25,000,000</TD> <TD>$10,875,000, plus 80 percent of the amount in excess of $25,000,000.</TD> </TR> </TABLE>

(b) Unfunded vested benefits allocable to insolvent employer undergoing liquidation or dissolution; maximum amount; determinative factors