New IRS Rules Allow AMR To Freeze Pilot Pension Plans

Law360, New York (November 9, 2012, 5:43 PM EST) -- The U.S. Department of the Treasury and the Internal Revenue Service finalized a rule change Thursday to ease pension rules for bankrupt companies, a move that will allow American Airlines Inc. to freeze and retain pilot pension plans instead of cutting them.

The final regulations, which are effective immediately, let debtors get around so-called anti-cutback rules and eliminate the obligation to make lump-sum pension payments to retirees. The old rules had barred plan amendments that eliminate or reduce accrued benefits, early retirement benefits and related benefits...
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