Pension Protection Act Of 2006 - PPA

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DEFINITION of 'Pension Protection Act Of 2006 - PPA'

An act of legislation that makes a large number of reforms to U.S. pension plan laws and regulations. This law made several pension provisions from the Economic Growth and Tax Relief Reconciliation Act of 2001 permanent, including the increased IRA contribution limits and the increased salary deferral contribution limits to a 401(k). It also attempts to strengthen the overall pension system and reduce the reliance on the federal pension system and the Pension Benefit Guaranty Corporation.

INVESTOPEDIA EXPLAINS 'Pension Protection Act Of 2006 - PPA'

Along with making past provisions permanent, the act also attempts to strengthen the pension system. This is done through the requirement that companies with under-funded pensions pay additional premiums along with the elimination of loopholes that allowed under-funded pensions to miss pension payments. The act also requires that pension plans provide more accurate assessments of their pension obligations.

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RELATED FAQS
  1. What does the Pension Protection Act of 2006 say about charitable contributions?

    According to the Pension Protection Act of 2006 (PPA), you can make a distribution from your IRA payable to a charity. A ... Read Full Answer >>
  2. How do gains from my 401(k) figure into my taxable income?

    Capital gains from a 401(k) account figure into taxable income in that capital gains are taxed at the ordinary income rate ... Read Full Answer >>
  3. Does my employer's matching contribution count towards the maximum I can contribute ...

    Contributions to 401(k) plans come from employee salary deferral and employer match dollars. According to the IRS, employees ... Read Full Answer >>
  4. How much will an employer generally contribute to a 401(a) plan?

    The amount an employer contributes to an employee's 401(a) retirement savings plan can vary from plan to plan. 401(a) plans ... Read Full Answer >>
  5. When can benefits be received from a provident fund?

    Like most retirement savings vehicles, participants in provident funds are eligible to receive benefits at retirement. However, ... Read Full Answer >>
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    Because Social Security income does not continue indefinitely, it cannot be classified as a perpetuity. What Is a Perpetuity? A ... Read Full Answer >>
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