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Depends what you are are talking about. Is it for funding or payout? There is no way to waive the phase in that is defined by the Internal Revenue Code. When you pay out the 415 100% of pay limit is phased in on service which includes all year even the ones that existed before the Plan. And base on DOH both owners will have 10+ years of service at the end of 2026. Assume you've worked enough to satisfy the Plans service accrual rules. When you pay out the 415 dollar limit that is phased in on participation which only includes years the plan is active and at the end of 2026 it will be impossible to have more than than 7 years of participation given the plan's start date (unless you have participation from a prior DB plan but then you would also need to off set for prior payout) so you can get no more than 70% of the dollar limit. But that is payable at age 62. Since at the end of 2026 neither of you will be age 62, you'll need to actuarially reduce the figure from age 62 to payout age. And the overall limit is the lower of those two. Then when you convert that to a lump sum you need to use both the plan factors and the IRS factors and the lump sum is the lower of those two numbers. And figuring this all out correctly relies on knowing the Plan's actuarial assumptions and the underlying demographic data for the participants because they can affect the calculations and cause it to be lower than the IRS absolute max which probably what CHAT GPT is spitting out. So if you are getting 3 different numbers, the one who has the most information - your TPA - is probably the correct one.

People here are very helpful, but I don’t think anyone will do this calculation without ALL the information nor for free. You or the client need to hire an actuary to do this properly. If you’re not happy with the one you have now, find another. Don’t try to do this on the cheap.

You can try this site, but I have not reviewed it accuracy nor its compliance with all regulations. But it on the surface it looks like it is asking for all the right variables. https://pensionresource.website/EAMain?content=EAMain.Calcs.Proj415Lumps

If you're making 22% returns that's great but it's also likely to limit your contributions and or cause you to be overfunded on a 415 basis. Neither of the owners are at the comp limit from what you've shown so you're going to wind up with the lessor of the 3 year high comp or actuarial reduced dollar limit from age 62 to payout. It looks like both will have 10+ years of service but only 7 years of participation at the end of 2026. You should probably ask the actuary for an analysis of the funded status with a projection to 2026 and be prepared to pay for it and come up with a strategy limiting the overfunding. That might include more conservative investments, discontinuing contributions, covering more participants (if possible), increasing owner salary to raise the limit. Thous are just a couple of things but with out access to you plan data it's really tough to give you a final answer that you want. But if the Plan's actuary told you the 415 payout limit is X and the plan assets of Y are greater than that, they are probably correct.

dependent on the actual plan design you potentially need to calculate various factors for each person at attained age at termination, normal retirement age, age 62. That is using 5.50%. 5.0% and 417(e) rates. Btw, you need to watch out not to exceed 415 limites along the way for 2024 (if applicable) and 2026. Varous proration rules applied to dollar-based limit and compensation-based limit. The precise guidance in the IRC Section 415(b) and the final 415 regulations. GL.

No. I filed a VCP application on March 1, 2023, and received a Compliance Statement on February 18, 2025. By contrast, I filed a different application on December 7, 2020, and received a Compliance Statement on January 28, 2021. Both were nonamender failures.

It wasn't my client but if my memory was the IRS or the DOL took the position that the first filing wasn't complete and rejected the amendment. Sorry, I don't recall the details better but that event is what made management here change our somewhat casual willingness to file without an audit report and amend later.

Yes, they have. It hasn't happened a lot but we have had clients get caught in this. We no longer recommend they do this but file late and DFVCP file. The fines under that program are so small compared to if the 5500 gets declared late. We will do the file and amend later but they have to give us written direction so we can raise that as a defense if they get hit and come looking to collect from our firm.