Pension Protection Act of 2006

On August 17, 2006, President Bush signed into law the Pension Protection Act (PPA) of 2006. This pension reform legislation has sweeping effects on nearly all retirement savings plans. Although Congress designed the bill to reform the defined benefit retirement plan system and prevent taxpayer bailouts of under-funded pensions, this legislation also includes a host of significant changes affecting IRAs with various effective dates, some beginning in 2006.

Recommended Action Steps

• Financial organizations are strongly recommended to begin using an updated disclosure statement as soon as possible.
  
  
• Existing account owners should be advised of the changes and provided with an updated disclosure statement through the use of an IRA Amendment.
  
  
• Financial organizations should consider updating their ancillary IRA forms so they are in a better position to help their IRA owners take advantage of the many benefits that PPA has to offer.