AndyH

Never mind, maybe a compromise is the correct solution. Sure, you can increase a non-terminated participant's benefit for whatever you wish, including 415 indexing. But i would submit that it is not a "frozen plan" and that testing is necessary for 401(a)(26), 410(b) and possibly 401(a)(4). The situation that I described assumed a non-employee, which is not Gary's situation.

Well we hardly ever disagree, so I am reluctant to raise the question, but isn't this a question as to whether or not a benefit above 415 has been accrued? I have heard Jim Holland say over and over that the answer is no. And, I could be wrong, and I haven't researched this recently, but I have looked at this in the past and I did not arrive at your conclusion. Maybe others could chime in.

I thought the plan need a real COLA provision (e.g. everybody gets a increase for CPI) for a frozen retiree to get the benefit of an increase in the 415 limit, no?

There are a few problems with this but the first is that these payments, at least the $25K ones, would not qualify for rollover treatment because they would be part of a series payments lasting over more than 10 years. The first may have the same issue. And you've got document issues as well as the issue of whether or not the NRA is justfiable.

I vote #2 for the reason you stated.

Did you see this one yet? http://benefitslink.com/boards/index.php?showtopic=28264

Didn't want to let this one slip by without a dissenting view. Does this make sense to anybody? Not me.

question retracted.

Never mind me, ..just chop licking...hot out here next to Ned's boat....

I think it says you don't have to worry about 417(e) (the use of a rate below 1/15 solely to comply with 417(e) ) causing a violation. If the plan said the lump sum is the greater of the 417(e) lump sum and the lump sum using 5% GAR, then you would have a violation, because the fixed rate is not at least 6.6666%.

No, 417(e) is not relevant here; it is specifically exempted under 1.401(l)-3(b)(iii)(E).

Isn't this the old RR 71-446 issue? Payment prior to SSRA must be reduced by 1/15th or more (6.6666%)for 5 years, 1/130th thereafter. If penman's plan provides for an early retirement reduction of 6.50%, then with mortality the reduction must amount to at least 1/15th per year from SSSRA down. So it is probably ok. 1.401(l)-3(e)

flosfur, your comments are way out of line, IMHO. How often do you say thank you when somebody takes the time to help you with your question? And you have the gall to take issue with someone pointing out that there is new information pertinent to your question?

FYIFV Effen knows that one. I'm not sure if anyone else does.

If you leave out Humble, you may get some wise guy/animal like Donkey Kong calling you unhumble or worse

That would be my take.

Are you sure that isn't just within the context of prior benefit structures? I have not had time to analyze it, but if that was snuck into one of the recent laws I missed it.

Good comments. Inspired, no doubt, by Big Papi. flosfur, yes, you can freeze insurance levels. But you need to test it. And eventually as Belgarath pointed out, the test will likely fail. Not immediately. Maybe not even for several years. But eventually.

If it does not affect actual allocations, sure. But you'd have to make sure of that IMHO.

Sure, the insurance could be surrendered. It happens all the time. Re testing, I would think that each insurance level, as a percent of the benefit, would constitute a different benefit that would be tested under 1.401(a)(4)-4. That would be a body count amoung each percentage insurance level. The regulation provides for some aggregation of levels. New people with no insurance would be 0's in each level tested.

No, (regarding #2) not a problem as long as you are consistent regardless of HCE or NHCE. Life insurance is not a protected benefit. Item 1 could require testing for BRFs under a(4) and would require document alterations.

You have very good reason to question him. Your instincts are right. Somebody needs legal advice. Calling Ned......

What does the insurance agent say?

Congratulations and many thanks, Dave, as well as Holly, Mary, and Jeanette. We much appreciate all your efforts. Every day. p.s. did pax say something about organizing a party, or did I just start a rumor?