---
kind: "section"
citation: "29 C.F.R. § 4022.25"
title: "29"
number: "4022.25"
heading: "Five-year phase-in of benefit guarantee."
url: "https://uscodex.org/cfr/29/4022.25"
---

# §4022.25. Five-year phase-in of benefit guarantee.

- (a) **Scope.** This section applies to the guarantee of benefit increases which have been in effect for less than five years.
- (b) **Phase-in formula.** The amount of a benefit increase computed pursuant to [§ 4022.24](/cfr/29/4022.24.md) shall be guaranteed to the extent provided in the following formula: the number of years the benefit increase has been in effect, not to exceed five, multiplied by the greater of (1) 20 percent of the amount computed pursuant to [§ 4022.24](/cfr/29/4022.24.md); or (2) $20 per month.
- (c) **Computation of years.** In computing the number of years a benefit increase has been in effect, each complete 12-month period ending on or before the termination date during which such benefit increase was in effect constitutes one year.
- (d) **Multiple benefit increases.** In applying the formula contained in [paragraph (b)](#b) of this section, multiple benefit increases within any 12-month period ending on or before the termination date and calculated from that date are aggregated and treated as one benefit increase.
- (e) Notwithstanding the provisions of [paragraph (b)](#b) of this section, a benefit increase described in [paragraph (a)](#a) of this section shall be guaranteed only if PBGC determines that the plan was terminated for a reasonable business purpose and not for the purpose of obtaining the payment of benefits by PBGC.
- (f) **PPA 2006 bankruptcy termination.** In a PPA 2006 bankruptcy termination, “bankruptcy filing date” is substituted for “termination date” each place that “termination date” appears in paragraphs [(c)](#c) and [(d)](#d) of this section. Example: A plan amendment that was adopted and effective in February 2007 increased a participant's benefit by $300 per month (as computed under [§ 4022.24](/cfr/29/4022.24.md)). The contributing sponsor of the plan filed a bankruptcy petition in March 2009 and the plan has a termination date in April 2010. PBGC's guarantee of the participant's benefit increase is limited to $120 ($300 × 40%), because the increase was made more than 2 years but less than 3 years before the bankruptcy filing date.

## Notes

### Amendments

[61 FR 34028, July 1, 1996, as amended at 67 FR 16956, Apr. 8, 2002; 76 FR 34603, June 14, 2011; 83 FR 49804, Oct. 3, 2018]

### Authority

Authority: 29 U.S.C. 1302, 1322, 1322b, 1341(c)(3)(D), and 1344.

### Source

Source: 61 FR 34028, July 1, 1996, unless otherwise noted.

### Amendments

[61 FR 34028, July 1, 1996, as amended at 67 FR 16956, Apr. 8, 2002; 76 FR 34603, June 14, 2011; 83 FR 49804, Oct. 3, 2018]