david rigby

See "Congress" "There ought to be one day-- just one-- when there is open season on senators." Will Rogers

FWIW, the IRS has issued a new Revenue Procedure on applications for waiver of minimum funding. http://benefitslink.com/IRS/revproc2004-15.pdf

Currently, no version modifies the 417 rate. Look again; they all modify ERISA Section 4006(a)(3)(E) to determine the PBGC variable premium liability.

If you want to read the versions, search here http://thomas.loc.gov/ for HR3108.

Searched where? My first guess would be PLRs. Perhaps DOL regs?

Maybe this will help: http://www.irs.gov/irm/part4/ Scroll down to 4.71 I wonder exactly what the request means; to the IRS, the Schedule B is the actuarial report.

Likely this has happened before, and the question has already been answered. (Unfortunately, I'm not sure where to look for confirmation.)

Likely most Red Sox and Yankee fans will fail to understand this, but the rest of the world does not care about your rivalry.

I agree with Mike.

Probably want to be consistent. Look to prior practice for precedent?

IRS publication 590 http://www.irs.gov/pub/irs-pdf/p590.pdf See page 13 for this comment: "Benefits from previous employer’s plan. If you receive retirement benefits from a previous employer’s plan, you are not covered by that plan."

This seems contradictory to me.

Neither this http://benefitslink.com/IRS/revproc2003-10.shtml nor BNA have any indication this Rev. Proc. has been modified.

Correct. See section VII at http://benefitslink.com/IRS/notice98-52.shtml

Try www.freeerisa.com

Not sure. One hopes that the plan will answer that question, but perhaps you have checked. If not, then you may have a situation that needs administrative interpretation. Usual advisable to make sure it is in writing.

Look here. Maybe use the "hand-print" version. http://www.dol.gov/ebsa/5500main.html

Why would you want to do this? Negatives: - administrative expense of the distributions, - remaining ongoing expenses will probably be higher as a percent of total funds, - undesirable precedent of early distribution of funds otherwise earmarked for retirement, - lessened bargaining power for the plan since total funds will now be reduced.

I'm a pension actuary, not life insurance. Broadly speaking, your summary is valid. Putting aside the question of insurable interest (which is not trivial), the ability of the Texas system to "profit" from large numbers of life insurance policies is suspect. More likely, the profit will belong to whoever gets a commission. Or the underwriting will be "questionable." Be carfeul who you take advice from.

I think most states require an insurable interest at the time at policy is issued, without any conditions later. However, it appears in the original link above that the Texas system is considering purchasing life insurance on retirees, without regard to whether they are insuring a death benefit or any other insurable interest.

Seems difficult to apply that concept to retirees.

Exactly! http://www.plansponsor.com/pi_type10/?RECORD_ID=23800

Facts and circumstance. See Mike's advice. BTW, the net impact might be the additional FICA taxes.

http://www.dfw.com/mld/dfw/news/7751814.htm

At its very basic, this is "the taxpayers cannot afford..." The PBGC is a mandatory insurance program that does not contain the prime elements of insurance: voluntary purchase by the buyer and insurable interest. (OK, I know that is an oversimplification, but my point stands.) If this were being designed from scratch, we would have mandatory minimum funding that made the PBGC irrelevant. There is no reason the taxpayers should subsidize/guarantee everyone else's pension plan. The other result is that 99% of the DB plan sponsors view the "premium" as a tax. I’ll get down off my soapbox now.