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Retirement-Related Benefits
 6 Months Ended
Jun. 30, 2024
Retirement Benefits [Abstract]  
Retirement-Related Benefits Retirement-Related Benefits:
The company offers defined benefit (DB) pension plans, defined contribution plans, as well as nonpension postretirement plans primarily consisting of retiree medical benefits.
IBM U.S. Retirement Plan Changes
Effective January 1, 2024, IBM changed how it provides certain retirement-related benefits in the U.S. IBM is providing a new benefit to most U.S. employees under its existing U.S. Qualified Personal Pension Plan (Qualified PPP) called the Retirement Benefit Account (RBA). This is in place of any IBM contributions to the U.S. employees' 401(k) Plus accounts. IBM U.S. regular full-time and part-time employees with at least one year of service will participate in the RBA. Each eligible employee's RBA is credited monthly with an amount equal to five percent of their eligible pay with no employee contribution required. Under the RBA, eligible employees earn six percent interest through 2026 and starting in 2027, will earn interest equal to the 10-year U.S. Treasury Yield, subject to a three percent minimum per year through 2033. Eligible employees also received a salary increase effective January 1, 2024 for the difference between the IBM 401(k) Plus contribution percent they were previously entitled to receive and the five percent RBA pay credit. Since the RBA is a component of the Qualified PPP, it is funded by the trust for the Qualified PPP along with all other benefits in the Qualified PPP.
As a result of this change, inactive pension plan participants no longer represent substantially all of the participants in the Qualified PPP. As required by U.S. GAAP, this changed the amortization period of unrecognized actuarial losses from the average remaining life expectancy of inactive plan participants to the average remaining service period of active plan
participants in 2024. Recognized actuarial losses for the U.S. Plans increased by approximately $100 million and $200 million for the three and six months ended June 30, 2024, respectively, as compared to the prior-year periods, primarily driven by the change in amortization period. There was no impact to funded status, retiree benefit payments or funding requirements of the Qualified PPP due to the change in amortization period.
The following tables provide the pre-tax cost for all retirement-related plans.
Yr. to Yr.
(Dollars in millions)Percent
For the three months ended June 30:20242023Change
Retirement-related plans — cost:   
Defined benefit pension and defined contribution plans — cost$320 $259 23.6 %
Nonpension postretirement plans — cost30 33 (8.1)
Total$350 $292 20.0 %
Yr. to Yr.
(Dollars in millions)Percent
For the six months ended June 30:20242023Change
Retirement-related plans — cost:   
Defined benefit pension and defined contribution plans — cost$643 $541 19.0 %
Nonpension postretirement plans — cost60 65 (7.1)
Total$704 $606 16.2 %
Cost/(Income) of Retirement Plans

The following tables provide the components of the cost/(income) for the company’s retirement-related benefit plans.
(Dollars in millions)U.S. PlansNon-U.S. Plans
For the three months ended June 30:2024 202320242023
Service cost (1)
$98 $— $41 $44 
Interest cost (2)
254 272 264 292 
Expected return on plan assets (2)
(340)(382)(384)(362)
Amortization of prior service costs/(credits) (2)
— 0 5 5 
Recognized actuarial losses (2)
129 27 128 101 
Curtailments and settlements (2)
— — 2 6 
Multi-employer plans— — 3 3 
Other costs/(credits) (2)
— — 12 10 
Total net periodic pension (income)/cost of defined benefit plans$140 $(82)$71 $99 
Cost of defined contribution plans15 151 94 91 
Total defined benefit pension and defined contribution plans cost recognized in the Consolidated Income Statement$155 $69 $165 $190 
(1)Increase in U.S. Plans service cost in 2024 is due to the Qualified PPP plan changes described above.
(2)These components of net periodic pension cost are included in other (income) and expense in the Consolidated Income Statement.
(Dollars in millions)U.S. PlansNon-U.S. Plans
For the six months ended June 30:2024 202320242023
Service cost (1)
$197 $— $85 $88 
Interest cost (2)
508 545 532 580 
Expected return on plan assets (2)
(681)(764)(773)(718)
Amortization of prior service costs/(credits) (2)
— 0 11 10 
Recognized actuarial losses (2)
257 55 258 203 
Curtailments and settlements (2)
— — 4 5 
Multi-employer plans— — 6 6 
Other costs/(credits) (2)
— — 20 19 
Total net periodic pension (income)/cost of defined benefit plans$280 $(165)$143 $194 
Cost of defined contribution plans27 323 193 188 
Total defined benefit pension and defined contribution plans cost recognized in the Consolidated Income Statement$307 $158 $336 $382 
(1)Increase in U.S. Plans service cost in 2024 is due to the Qualified PPP plan changes described above.
(2)These components of net periodic pension cost are included in other (income) and expense in the Consolidated Income Statement.
Cost of Nonpension Postretirement Plans
The following tables provide the components of the cost for the company’s nonpension postretirement plans.
(Dollars in millions)U.S. PlanNon-U.S. Plans
For the three months ended June 30:2024202320242023
Service cost$1 $1 $1 $1 
Interest cost (1)
27 29 10 10 
Expected return on plan assets (1)
— — 0 (1)
Amortization of prior service costs/(credits) (1)
(7)(7)0 0 
Recognized actuarial losses (1)
— — 0 0 
Curtailments and settlements (1)
— — — — 
Total nonpension postretirement plans cost recognized in the Consolidated Income Statement$20 $23 $10 $10 
(Dollars in millions)U.S. PlanNon-U.S. Plans
For the six months ended June 30:2024202320242023
Service cost$1 $2 $1 $1 
Interest cost (1)
53 58 21 19 
Expected return on plan assets (1)
— — (1)(1)
Amortization of prior service costs/(credits) (1)
(15)(15)0 0 
Recognized actuarial losses (1)
— — 0 (1)
Curtailments and settlements (1)
— — — — 
Total nonpension postretirement plans cost recognized in the Consolidated Income Statement$40 $46 $21 $19 
(1)These components of net periodic pension cost are included in other (income) and expense in the Consolidated Income Statement.
Plan Contributions
The company does not anticipate any significant changes to the expected plan contributions in 2024 from the amounts disclosed in the 2023 Annual Report. The table below includes contributions to the following plans:
(Dollars in millions)Plan Contributions
For the six months ended June 30:20242023
U.S. nonpension postretirement benefit plan
$110 $134 
Non-U.S. DB and multi-employer plans (1)
40 29 
Total plan contributions$150 $163 
(1)Amounts reported net of refunds.
The U.S. nonpension postretirement benefit plan contributions in the table above were funded with U.S. Treasury Securities. Additionally, during the six months ended June 30, 2024 and 2023, the company contributed $390 million and $347 million of U.S. Treasury securities, respectively, to the Active Medical Trust. Contributions made with U.S. Treasury securities are considered a non-cash transaction.