IRS Releases Additional Guidance on Special Financial Assistance

The IRS has released Revenue Ruling 2022-13 on the applicability of Internal Revenue Code (IRC) Section 432(b)(7) following a merger involving a multiemployer defined benefit (DB) plan that has received special financial assistance (SFA). IRC Sec. 432(b)(7) provides for deemed critical status for eligible multiemployer plans receiving SFA. If a multiemployer DB plan that has received SFA is merged into a multiemployer DB plan that has not received SFA, and the designated plan ongoing is the one that has not received SFA, is the ongoing plan deemed to be in Sec. 432(b)(7) critical status? The IRS holds that, in this case, when the ongoing plan after a merger was not the one that had received SFA prior to the merger, it is not deemed to be in Sec. 432(b)(7) critical status solely as a result of the merger.