Jump to content



Recommended Posts

Can someone please explain the answer?

Based on the following information, what is the participant's annual top-heavy minimum accrued

benefit as of June 30, 1997?

The participant works over 1000 hours per year and only participates in this plan.

The plan has always been super top-heavy.

The top-heavy min benefit is based upon years of service.

The plan year is July 1 to June 30.

DOH = 7/1/90

Plan Effective = 7/1/86

Annual comp:

6/30/91 = $20K

6/30/92 = 25K

6/30/93 = 25K

6/30/94 = 15K

6/30/95 = 22K

6/30/96 = 23K

6/30/97 = 10K

ANSWER = $3080???

Link to comment
Share on other sites

Looks to me like the question is testing your knowledge of IRC 416©(1)(D).

High 5 year average comp is 22,000 (92 thru 96). Seven years of top heavy service.

22000 x .02 x 7 = 3080.

I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Create New...