ak2ary

Of course that only applies if each match formula would cover a nondiscriminatory classification of employees...and, if that is true, you would likely pass the Avg Bft Pct Test and each plan could test on its own

Last opinion I heard from Jim Holland was that inactive participants in DB plans are considered participating for 404(a)(7) purposes because any contribution made to the db enhances the security of their benefit. Inactive DC particcipants are not considered as participating for 404(a)(7) That being said, unless you have a DC contribution in excess of 6% of pay 404(a)(7) does not apply

Would the plan or the participant have an insurable interest in the participant's sister's ex-husband? I dont think so

To take it a step further, the defined benefit nature of the benefit is a protected benefit under 411(d)(6). IT cannot be merged with a 401(k) plan unless the resulting plan is a 414(k) defined benefit plan with separate DC accounts. Of course this type of plan cannot have a 401(k) feature since it is a DB plan. Sorry..no way to do it

Couple things Although IRS is redrafting their multiple Annuity Starting Date rules in the proposed regs, the position they took in the proposed regs is that it is the actual payment that matters, not the old plan's accrued benefit. In fact, in this situation under the proposed regulations, the benefit paid to the remaining partners (which would offset the maximum benefit in any new plan) WOULD CHANGE EVERY TIME 417E RATES CHANGED. This falls in the "careful what you ask for" department. The correct answer is that the accrued benefit actually paid by the old plan should offset 415...but others disagree Anyway, if the one participant you are spinning to a separate plan is terminated or is not accruing under the separate plan 401(a)(26) is not violated cuz no HCE accrues a benefit under the plan that benefits less than 40%

Was he a key employee? If he was, I think the rules back then would have worked the same as now

absolutely

Lisa Mojiri Azad said alot of stuff that was absolutely ridiculous. She also caveated all of them by saying "My reading" or "my interpretation" ...while Jim Holland did not publicly disagree with her, he also did not support her positions. Since Jim has publicly taken the opposite position many times on most of these issues and Marty P has taken even less restrictive stances than Jimmy; it seemed that they didn't want to disagreee with each other in public. Nonetheless, I think most practicioners would agree that the triple-stacked match as described above is exempt fom top heavy if the only plan of the employer

But Tom, I'm sure you would agree, if your BeRF failed the ratio pct test you would have to pass BOTH parts of the NDCT, the Reasonable Classification Test and the Nondisc. Classification numerical Test

The election form has to include only benefits commencing at the annuity starting date for which the QJSA notice was provided. But the election form is not your total notice requirement. You also must include (among many other things) information telling the participant of their right to defer payment. (In fact PPA strengthens this requirement). The plan cannot eliminate any potential benefit commencement dates at plan termination, as they are protected under Section 411(d)(6)

I don't think that amendment recaptures the "lost" years. The 415 $ limit is reduced if you have less than ten years plan participation, not if you are credited with less than ten years of benefit accrual service. Thus if you don't get credit under 415 for years when the plan is frozen, this amendment won't help.

Its not a CODA as long as it satisfies the requirements for a waiver, such as the waiver is irrevocable and adopted upon initial eligibility for any plan of the employer. It's also not a CODA unless the waiver of benefits impacts his COMPENSATION, in this case it doesn't.

I would be careful here. The guidance that prohibits you from excluding part-time employees refers to other types of exclusions that have the same effect as part time, and if I remember right, specifically mentioned per diem. The concern is that it would be an impermissible service requirement. I don't agree with it for the same reason I don't agree with the part-time employee stance. I do agree that you can exclude blue-eyed blondes

absolutely.. the only time the db plan can be left out of the ABT is if no plan in the testing group utilizes cross testing and since you started by saying that you're cross testing, you need the db accruals

There is a very strong arguement that you would absolutely protect the future interest credit basis for past pay credits. That is, you can divide your cash balance account into a post 2006 and pre 2007 sub accounts and preserve the interest credit basis on the pre-2007 amounts. Especially in plans that define the accrued benefit as an annuity at NRA, you can't change the interest credit basis (unless you guarantee to increase it) without potentially reducing a benefit that has already been accrued...so you can only do it with respect to future pay credits. Looks like some relief may be given as a result of PPA but that is not clear either

I spoke with B. Graff about this issue and he called Judy Miller to discuss the intent in changing the citation for CL. The intention, he was assured was to increase the deduction limit and there was never any intention to change the definition of CL used to calculate the max deduction. Thus, its an EOY number

I talked to Brian on this today and he confirmed that he never said you lose the 6%, the first 6% to the DC is always deductible. He doesn't know what he said that people have misinterpreted. But he was very clear if 404(a)(7) applies, only the amount in excess of 6% counts toward the limit.

The question really is...Before actual retirement but after NRA do I use pre-retirement or post retirement assumptions. Absent something in the plan directly to the contrary I would argue for pre-retirement assumptions since, in this plan, there is no forfeiture at death until actual retirement. Having said that, I have heard Jim Holland say that actuarial equivalence post-NRA requires a mortality increment. Most in the room disagreed. In your plan there is no forfeiture at death or benefit of survivorship until actual retirement

I agree that you get to fund to 100% of CL plus the 6% DC. I didn't hear Brian's talk, but that would be a change of the position he was taking 2 weeks ago. If thats the case, you probably want to wait on advising anyone to go over 6%

Any time the QJSA notice is given after the Annuity Starting Date, you have an RASD, subject to the RASD rules, necessitating RASD language in the plan, including the ability to take a prospective annuity actuarially equivalent to the retro annuity. If the plan does not provide for these things, and the plan does not provide the QJSA notice in a timely manner, the plan will find itself with an operational defect for failing to follow plan terms and/or a form defect for failing to have RASD language.

Yes but the key is that under 6% 404(a)(7) doesn't apply at all, so on the DB side you are not limited to the 22% min or 31%-DC contrib...if the DC is 6% or less you can deduct the DB max,,,in this case 75%

oops I mean you were looking at 803©

I believe that you are looking at Section 803(b) of the Act rather than Section 803(a). Section 803(b) deals with excise taxes on non deductible (as a result of 404(a)(7)) matching contribs...Section 803(a) changes the the 404(a)(7) calc itself and does not distinguish between PS contribs and matches

That was when they offered those classes ASPPA doesn't do them I think they couldn't afford both the classes and the 2nd P

The regs under 1.411(d)(4) address this issue head-on. The regs noted that many plans provided for discretionary benefits and ruled that this was impermissible. They further ruled that, if a plan with a discretionary form paid any benefits in that form after a certain date ( I believe it was in 1989) the benefit became a protected benefit for all