In PBGC's answer to 2004 Blue Book Q&A 2 item b, PBGC stated that a 1.411(a)-4(b)(6) forfeiture would not affect the inclusion of the participant in the flat rate premium count, but that it would result in the exclusion of the participant's benefit from the variable rate premium -- the reason being that IRS staff advised the PBGC that the benefit would be disregarded for current liability, and current liability was used for the variable rate premium. I understand this logic extends to the current environment where the relevant liabilities are (based on) target liability. Regarding the exclusion of these benefits from current liability and target liability, is anyone aware of where the IRS has actually opined on this or even mentioned it, other than the PBGC's statement in 2004 Blue Book Q&A 2? If they haven't opined, relying on the PBGC's statement might be aggressive. In this case, my follow-up question would be whether it might be objectionable to the IRS if I established a probability assumption for the reappearance of the participant (and consequent benefit reinstatement) -- where such probability might be very low if the participant was old, long gone, etc. (as it would reflect my expectations).
