Effen

That is what I thought as well. It seemed to me that they could a 6 month wait, but not a 1000 hours. Is this something the IRS would pick up on an audit or do you think it is beyond most agents knowledge level? The plan has some other "issues" and there is a chance these "issues" will trigger an audit.

Based on the following I agree with Rcline, noting that if the NRD is more than 6 months from NRA it does not meet the safe harbor and would need to be tested. I also agree that you can assume what ever is reasonable. I have several plans where NRA is 65, but I'm assuming an higher age for the HCE. If it feels unreasonable, ask for a letter from the HCE stating his intention to work to the assumed age. If he doesn't give it, then it probably wasn't reasonable to begin with. 411(a)(8) NORMAL RETIREMENT AGE. --For purposes of this section, the term "normal retirement age" means the earlier of -- 411(a)(8)(A) the time a plan participant attains normal retirement age under the plan, or 411(a)(8)(B) the later of -- 411(a)(8)(B)(i) the time a plan participant attains age 65, or 411(a)(8)(B)(ii) the 5th anniversary of the time a plan participant commenced participation in the plan. 1.401(a)(4)-12 - (4) Conversion of normal retirement age to normal retirement date. A group of employees does not fail to have a uniform normal retirement age merely because a defined benefit plan provides for the commencement of normal retirement benefits on different retirement dates for different employees if each employee's normal retirement date is determined on a reasonable basis with reference to an otherwise uniform normal retirement age and the difference between the normal retirement date and the uniform normal retirement age cannot exceed six months for any employee. Thus, for example, benefits under a plan do not fail to commence at a uniform normal retirement age of age 62 for purposes of §1.401(a)(4)-3(b)(2)(i), merely because the plan's normal retirement date is defined as the last day of the plan year nearest attainment of age 62.

Can a plan that is using 1 entry date (1st day of PY) require 1000 hours of service to become a participant? It just feels wrong to me. It is a prototype - are you surprised? Entry Date = 1st Day of PY following the date on which the EE meets the eligibility requirements Year of Participation/Service for eligibility is defined as "Completion of 1,000 hours of service" (note "s", not "S") Service in the Eligibility Section is defined "The Service requirement shall be 1,000 hours Year(s) of Service (if hours counting method is uses) or Period of Service (if elapsed Time method is used)....If the Hours of Service method is used and the period selected is less than 1 year, an Employee will not be required to complete any specified number of Hours of Service to receive credit for such period." (This doesn't seem to allow an hours requirement to be entered.) Plan using elapsed time for benefit accrual, 1000 hour rule for vesting. I think it is a MH prototype, but I can't tell for sure. These provisions just don't seem to fit together.

I agree with rmeigs, I need a little more info before I click into "help" mode. Your original typifies today's media culture. A lot of flashing accusations without a lot of meat. The government/society takes lots of peoples houses for lots of reasons. I don't know of too many instances that they just did it because they could. P.S. I'm sure sure what you expect a bunch of "employee benefits" people can do for your poor brother in his "partner".

Boy, maybe I forgot my actuarial funding 101, or maybe I never learned it, but that seems like a lot of work Pax. I have always thought of an FIL as basically a spread gain method, except that assumptions changes and amendments create bases and gain/losses do not. Therefore, I would take a simplistic solution and just take the difference of the AL's before and after the change. This assumes that Plan's UAL will be > 0 and the Plan is not in full funding. I have never thought of trying to create some hypothetical asset to calc a UAL, but that certainly doesn't mean your solution isn't without merrit, I just wouldn't have done it that way. Regarding the lump sum question, I could probably argue both sides. Do you assume a lump sum payment in your funding assumptions? If not, then your method treats the payment form selection as a gain/loss, which doesn't belong in the FIL base. The theory would be that they elected the window, so you should value the window on the standard assumptions. If after they elect the window, they select a lump sum form of payment, then that piece is a loss and is not part of the base. On the other hand, if the lump sum is part of your assumption, than I think you can argue it should be part of the base. You could always add the assumption of a lump sum payment with your other window assumptions so that it becomes part of the base. I just think you need to be reasonable and be able to defend either position.

Time to get back to work! :angry: Actually, I love the thread.

I think you need to establish a base, unless your assumption is that no one will take the window, but since you know people did, that would probably be unreasonable to assume they won't. Since you know who is taking it, won't it be reasonable to create a base equal A-B, where A = EAL for those who took the window, including the value of the window and B - EAL prior to any change (not assuming they retired or terminated, but just whatever the EAL was). Isn't that really the impact of the amendment?

A different view of the world. Makes what the Indians did even more impressive. $ spent / win Tampa Bay D Rays -- 438,255 Cleveland Indians -- 446,263 Milwaukee Brewers -- 493,023 Pittsburgh Pirates -- 569,149 Toronto Blue Jays -- 571,494 Washington Nationals -- 599,772 Oakland Athletics -- 629,838 Kansas City Royals -- 658,589 Minnesota Twins -- 676,940 Texas Rangers -- 706,949 Colorado Rockies -- 718,731 Florida Marlins -- 727,817 Chicago White Sox -- 759,374 San Diego Padres -- 771,839 Arizona Diamondcks -- 809,470 Cincinnati Reds -- 847,844 Houston Astros -- 862,685 St. Louis Cardinals -- 921,068 Atlanta Braves -- 960,637 Detroit Tigers -- 973,127 Baltimore Orioles -- 998,842 Los Angeles Angels -- 1,028,688 Philadelphia Phillies -- 1,085,477 Chicago Cubs -- 1,101,683 Los Angeles Dodgers -- 1,169,563 San Francisco Giants --1,202,660 New York Mets -- 1,220,552 Seattle Mariners -- 1,271,802 Boston Red Sox -- 1,300,054 New York Yankees -- 2,192,703

So where is all that happy Yankee / Red Sox banter now? $331,811,942 and what did it get? Maybe if they would have put a few more million in they could have won something. Personally - I love it. The only problem is now I don't have anyone to route against. Red Sox, Yankees, Braves all lost. hmmm, LETS GO PENS!

Do you mean Highly Compensated Employees? Are they also Key Employees? If they all are Key Employees, then they don't need to receive any Top Heavy benefits

$331,811,942 and what did it get? Maybe if they would have put a few more million in they could have won something. Personally - I love it. The only problem is now I don't have anyone to route against. Red Sox, Yankees, Braves all lost. hmmm, LETS GO PENS!

Does anyone other than you, the PA and the attorney know about the plan's termination?

I have notice most lawyers automatically attach an IRS Circular 230 Disclosure statement at the end of all of their emails. Should non-lawyers (actuaries, accountants, ASPPPPPPA credentialed) do the same? What are you all doing? Guess I should have searched first, but I'm still interested in opinions. prior post 1

WDIK - obviously you have forgotten your High School Physics Mass- Physics. A property of matter equal to the measure of an object's resistance to changes in either the speed or direction of its motion. The mass of an object is not dependent on gravity and therefore is different from but proportional to its weight. Therefore, technically a mass-submitter would have a very large body, but not necessarily be heavy.

There are a lot of good labor attorneys out there who write pretty crappy plan documents. Don't be afraid to talk to your client and their advisors, you should all be on the same team. Counsel wrote the plan, if it isn't clear to you; you need to talk to counsel so they make it clear. In reality, they are the only one who knows what they intended it to be (MP or PS). You definitely need to talk to them. FWIW, I thought Janet's reply was right on point and not at all condescending.

I've done it.

If the Plan does not allow retro-active payments than you can't pay them. If they can pay them, you need to be careful about spousal consent, ect... The IRS has some fairly new Regs on this issue, but it’s fair to say, they don't like to see them. If the plan didn't give the participant a suspension notice, your only real option is to actuarially increase the benefit to reflect the value of the missed payments. Otherwise, I believe you have effectively reduced his accrued benefit which is a 411(d)(6) violation. You should run this past the plan's attorney since they will need to defend the decision if the participant appeals.

Just a thought, but since he was active when he died, could you argue that he should qualify for the active death benefit? I don't know if waiving post retirement spousal coverage is the same as waiving the Pre-retirement Survivor Annuity when he comes back to work.

You can't aggregate for 401(a)(26). The plan would need to cover at least 40% of the employees (ie:2). How about using different benefits. One Dr. gets a big db benefit, the other Dr. gets something very small since he didn't realy want to be in the db to begin with. Just give him enough to say he is benefiting, .5%/YOS or something.

FWIW, I agree with Blink. I think it is definitely is a problem. Why not figure out how much you need to fund for the NHCEs to pass the non-discrim test and fund it now as well.

I think you first need to explain this to the client, then go back to the prior actuary and ask him to fix it. If you sign the Schedule B and know it is wrong (which you do) his mistakes become yours. Maybe you could calculate the required contribution assuming the bases were corrected, tell the client to make the larger contribution then you have another month to fight with the prior actuary. That way the client should be protected from the deficiency if they make a lower contribution that is corrected after the due date. Communication with your client is critical! Also, changing the method now will do no good. The prior schedule Bs are wrong and need to be corrected.

Here are a couple prior discussions that should be helpful benefitslink benefitslink 2

Following is the quote from the FASB: Technically you are right, they are talking ABO, not PBO, but how reasonable would be be to have an ABO > PBO? As far as I know, there has been no movement on this issue since around May 2005. Does anyone else know anything? FASB

COOL! I think I knew you when... - we can take this off-line now so that we don't waste Ereads or Harwoods time anymore.

I deleted my posts because, I'm typing faster than I'm thinking. I'm working on one now with a "frozen" piece so I will slow down and think it through. Sorry for the confusion. Getting back to the original question: No, assuming you have a salary scale assumption, it should not generate losses, if salary assumption is exactly realized, g/l s/b 0. I agree SC s/b 0 ABO<PBO, difference being due to salary assumption. Sorry again for any confusion.