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ARPA-21 15 year amortization - new plan for 2020


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Hi

I need to confirm the following as per my understanding.

Looking into a 2020 db plan design with providing prior year service. 

Plan has a minimum required contribution (MRC) based on amortization of funding target. Not worried about MRC as they want to maximize contribution.

Per law, 15 year amortization is effective for plan years beginning after 12/31/21 with an option of election for 3 prior years.

I am thinking to elect to have 15 year amortization starting with 2020 plan year and also have the sponsor to adopt the election (election is required to adopt 15 years, as per my understanding).

Am I missing anything here?

Thank you,

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  • 2 weeks later...

A follow up question, sorry if discussed before

If I am electing to use any of the ARPA-21 provisions for funding/AFTAP/amortization for 2020, do I need to attached an addendum to the Schedule SB for 2020?

For example, I used the 15 year amortization for 2020 for a brand new plan. SB, line 41a has reference to PRA 2010 only.

Another example, I have an election to switch to ARPA-21 for funding for an old plan.

Thank you

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