DOL Fiduciary Rule Status: Vacated 2024 Rule and Five-Part Test

The Department of Labor’s 2024 Retirement Security Rule — the most recent effort to expand who counts as a fiduciary when advising retirement savers — has been vacated by two federal courts and formally removed from the Code of Federal Regulations. As of April 20, 2026, the current status of the DOL fiduciary rule is that the 1975 five-part test again governs who is an “investment advice fiduciary” under the Employee Retirement Income Security Act, and the DOL has said it has no current plans to propose a replacement through notice-and-comment rulemaking.¹

The Five-Part Test That Now Applies

Under the restored 1975 regulation, a person providing investment advice is a fiduciary under ERISA only if all five of these conditions are met:

The person renders advice on the value of securities or other property, or makes recommendations about buying, selling, or investing in them.
The advice is provided on a regular, ongoing basis, not as a one-time interaction.
There is a mutual agreement or understanding between the advisor and the plan or its fiduciaries that advice will be provided.
There is an understanding that the advice will serve as a primary basis for investment decisions regarding plan assets.
The advice is individualized to the particular needs of the plan.

All five elements must be present for fiduciary status to attach.²

The DOL’s April 2026 Technical Release 2026-01 added that the existence of a contractual arrangement to provide advice for a fee can be a relevant factor in evaluating the “primary basis” and “mutual understanding” prongs, and warned that written disclaimers alone are “not necessarily determinative.”³

The DOL also declared the entire preamble to Prohibited Transaction Exemption 2020-02 — which had contained interpretive guidance on rollover advice and the “regular basis” prong — to be “effectively vacated” and “no longer reliable.” Earlier rulings in the Middle District of Florida (American Securities Association v. DOL, 2023) and the Northern District of Texas had already invalidated portions of that preamble, and the DOL concluded the remainder was too intertwined with the vacated pieces to be trustworthy. The operative text of PTE 2020-02 was republished in its original December 2020 form.⁴

How the 2024 Rule Was Vacated

The 2024 rule never took effect. Two federal courts in Texas stayed it before its scheduled September 23, 2024, effective date and later entered final judgments vacating it.

In the Eastern District of Texas, Judge Jeremy D. Kernodle stayed the rule on July 25, 2024, in Federation of Americans for Consumer Choice, Inc. v. U.S. Department of Labor. He found the DOL’s amendments to PTE 84-24 “unreasonable and arbitrary and capricious” and held that the agency had failed to reconcile the new rule with the Fifth Circuit’s 2018 decision striking down the 2016 fiduciary rule.⁵ Final judgment vacating the rule followed on March 12, 2026.⁶

In the Northern District of Texas, a coalition led by the American Council of Life Insurers, joined by SIFMA and the Financial Services Institute as intervenors, won a stay from Judge Reed O’Connor on July 26, 2024. He found the plaintiffs “virtually certain to succeed in establishing that the Department exceeded its statutory authority.”⁷ Final judgment vacating the rule was entered March 17, 2026.⁸

The Trump administration abandoned the appeal. The DOL asked the Fifth Circuit in November 2025 to withdraw its appeal of the lower-court rulings, and the court dismissed the consolidated appeal on November 28, 2025. In March 2026, the DOL filed a joint motion with plaintiffs asking the Northern District court to formally vacate the rule.⁴ On March 20, 2026, the DOL published a final rule (91 FR 13503) removing the 2024 rule from the CFR, effective April 20, 2026. Because the 2024 rule had been stayed before ever taking force, the DOL treated the removal as a ministerial step and skipped notice and comment.

Daniel Aronowitz, confirmed in September 2025 as Assistant Secretary of Labor for the Employee Benefits Security Administration, said the vacated regulation “wrongly sought to impose ERISA fiduciary status on securities brokers and insurance agents when there was not a relationship of trust and confidence.”¹

What This Means for Rollover Advice

The practical consequence of the reversion is that a broker or insurance agent giving a one-time recommendation — including advice to roll a 401(k) into an IRA — generally does not become an ERISA fiduciary under the restored standard. That was the exact scenario the 2024 rule was written to capture, and it is the scenario the five-part test’s “regular basis” and “primary basis” prongs typically exclude.² The DOL is also evaluating the status of prior interpretive documents, including Advisory Opinion 2005-23A, which suggested rollover advice is not generally investment advice under the five-part test.¹

What Still Protects Retirement Investors

Retirement advice is not unregulated. Several overlapping frameworks continue to apply:

Financial advisors who do qualify as fiduciaries under the five-part test and want to receive otherwise prohibited compensation, such as commissions on rollover recommendations, must still comply with the original PTE 2020-02. Its conditions include impartial conduct standards requiring best-interest advice, written acknowledgment of fiduciary status, disclosure of services and conflicts, documentation of why a specific rollover is in the investor’s best interest, written conflict-mitigation policies, and an annual retrospective compliance review.⁴
Broker-dealers recommending securities to retail customers, including retirement investors, remain subject to the SEC’s 2019 Regulation Best Interest, which requires them to act in the customer’s best interest and not place their own interests ahead of the customer’s.⁹
As of mid-2025, 48 to 49 states have adopted the NAIC’s revised Suitability in Annuity Transactions Model Regulation (#275), which requires insurance producers and insurers to act in the consumer’s best interest when recommending annuity products.¹⁰

The NAIC has argued that its model regulation was designed to harmonize with Reg BI and that state regulators conducted implementation reviews of the top 25 annuity writers to promote compliance.¹¹

Whether a New Rule Is Coming

The DOL’s Spring 2025 regulatory agenda listed a “deregulatory rulemaking action” on the investment advice fiduciary regulation, with a final rule scheduled for May 2026.¹² As of March 2026, no replacement rule had been released, and the DOL stated it had “no current plans to engage in notice and comment rulemaking” on investment advice fiduciary status.¹ Aronowitz has said the administration prefers relying on existing SEC and state oversight rather than expanding ERISA fiduciary obligations to brokers and insurance agents.¹³ The DOL has also said it will consider whether additional guidance, including transitional or non-enforcement relief, is appropriate.

The 2026 vacatur is the third time the DOL has tried and failed to expand the fiduciary definition beyond the 1975 standard. An initial 2010 proposal was withdrawn before finalization. The Obama administration’s 2016 rule, which introduced the Best Interest Contract Exemption, was struck down in its entirety by the Fifth Circuit in March 2018 in Chamber of Commerce v. Department of Labor; the court held that the DOL had “vastly exceeded its authority under ERISA.”¹⁴ Industry groups argued the 2024 version was “materially indistinguishable” from the 2016 rule.⁸ For now, the 1975 framework is what governs.

1
U.S. Department of Labor. DOL Removes 2024 Retirement Security Rule From Code of Federal Regulations
2
U.S. Department of Labor. Retirement Security Rule and Amendments to Class PTE for Investment Advice Fiduciaries
3
U.S. Department of Labor. Technical Release 2026-01
4
Federal Register. Retirement Security Rule: Definition of an Investment Advice Fiduciary: Notice of Court Vacatur
5
Justia. Federation of Americans for Consumer Choice v. U.S. Department of Labor
6
U.S. Chamber of Commerce. Federation of Americans for Consumer Choice v. Department of Labor
7
U.S. Chamber of Commerce. American Council of Life Insurers v. Department of Labor
8
SIFMA. SIFMA FSI Statement on Order Vacating the DOL 2024 Fiduciary Rule and Related PTEs
9
Insured Retirement Institute. DOL Fiduciary Rule
10
NAIC. Annuity Suitability and Best Interest Standard
11
NAIC. State Insurance Regulators Work to Protect Consumers Who Buy Annuities
12
NAPA Net. Trump Administration Wants to Drop Defense of Fiduciary Rule
13
PLANSPONSOR. DOL Returns to Previous Guidance on Fiduciary Status
14
U.S. Chamber of Commerce. Chamber of Commerce v. U.S. Department of Labor (Fiduciary Rule Appeal)