Blinky the 3-eyed Fish

Tom, don't you think that making this small a change would just be a modification to the VS document and not call for it to be individually designed?

Wouldn't that be akin to having a break in service of more than the allowable 500 hours?

I really don't think there is an argument for not accruing a benefit for someone with 500 hours, whether active, terminated, spayed, insane, redheaded, gimpy, perky or not. I don't think it's a matter of taking the conservative route. I think it's a matter of taking the correct route. Again I would ask under what situation could an active participant not accrue a benefit in a plan year if they have already worked 500 hours? Answer... there is none. BTW, I have that little man on my shoulder sometimes too. I try and flick him off, but the dude has some sort of tacky boots or something.

First I would like to say that I don't believe there is clear guidance, but at the LA Conference it was espoused that the EGTRRA amendment increases are akin to cost of living adjustments in how they are treated for this purpose. I believe this makes sense. Some documents reference the 415 limits and others do not and require an actual amendment to provide for the EGTRRA increases. To have the plans treated differently would not seem to be to be fair reasoning.

I haven't looked at the Rev. Proc., but 1 cent is 1 cent and absolutely immaterial for any purpose concerning a qualified plan.

Round off to zero.

One additional thought on this is that you could argue that only the compensation earned as of the date of of the change to the document is protected. For example, if you amend the plan to have the last day on 8/15, but the participant terminates 10/15, his allocation would be based on compensation through 8/15. It's aggressive and only a thought. Personally, I wouldn't do it.

Archimage, under what scenario would the active participants not accrue the benefit? They either stay active and are there on the last day or they terminate and satisfy the 500 hour requirement.

You had 4 plans merged into 1. What was the date of the merger in the documents allowing the merger? Was it the date the assets actually transferred? Depending on those answers you may have 3 plans that have a short plan year that ended on the date of the merger and 1 plan that will not have a short plan year.

No, the language in the EGTRRA amendment should cover different plan years.

Blaum, we know MGB's credentials. What are yours?

Look to the procedural checklist on page 4 of the forms located here: http://www.irs.gov/pub/irs-pdf/f5307.pdf

When was EGTRRA adopted in the DB plan? What is the top heavy language in the DC plan if there also is a DB plan? The answer to your question depends on the answers to these questions.

It might be more complex than that. First, because EGTRRA does not offer 411(d)(6) protection, the EGTRRA amendment must be adopted before anyone earns the right to the accrual, which is 1,000 at a minimum to accrue the DB TH minimum, but utimately depends on the document provisions. But, it also is possible that the DC plan has language that provides the 5% TH minimum even if the EGTRRA amendment was timely adopted in the DB plan.

37.5% is not the cutoff to require the NHCE's to receive the 7.5% minimum gateway. It is 35.000000000000000000000000000000000000000000000000000000000000000000001%

A defined benefit plan is not required to maintain the funding standard account past the year of termination. See Rev. Rul 79-237. You don't mention for what plan year your 5500 is for, but if it began after your termination date of 12/31/01, then no Schedule B is required.

I posed the question to see if you had a specific reason for filing 2 5500's. See the Derrin Watson answer at the link below. Basically, if the funds are separated completely, you would have to file 2 5500's, but that scenario wouldn't change just because the employers became a controlled group. http://benefitslink.com/perl/qa.cgi?db=qa_...employer&id=184 So, after assessing your situation, get back to us on how many 5500's there should be.

Why were 2 returns filed in the first place if you only have 1 plan?

Yes? If you are asking if the plan credited service before entering the plan at age 30 way back when, then based on the language you provided, yes. Seems a person could earn up to 10 years of credit before entering the plan at age 30. Of course your original question left out some important details. May I ask what the purpose of the question is?

Lynn, I don't believe you would have to submit. (I am going on logic here, so beware.) You have a restated GUST II word-for-word plan document that is adopted within the extended RAP. In my book that qualifies as meeting the requirements for not needing to submit to be granted the extended RAP.

Your are correct. Most of my plans have owners that have no where near 30 YOP and don't have large guaranteed benefits, so they end up having to waive if assets are not sufficient.

While I agree that the regs aren't written in the clearest manner (they never are), I have never seen the interpretation that would call for the age 70 TH benefit of $500 to then be actuarially increased from 65 to 70. I believe the normal late retirement rules would apply in this case. I assume the plan calls for the acturial increase for late retirement and not a suspension of benefits or forced distribution. Therefore, it's not the greater of the $400 actuarially increased to 70 or $500. Keep in mind the the actuarial increase takes place each year past NRA. So it's like this: 66 - greater of 65 benefit actuarial increased to 66 or benefit under plan at 66 67 - greater of prior number actuarial increased to 67 or benefit under plan at 67 68 - greater of prior number actuarial increased to 68 or benefit under plan at 68 69 - greater of prior number actuarial increased to 69 or benefit under plan at 69 70 - greater of prior number actuarial increased to 70 or benefit under plan at 70

RSNOW, you can't change to unit credit with automatic approval in the year of termination unless the plan is sufficiently funded.

RSNOW, you are correct.

K, Section 4.02(2), which you quote, prevents that from happening. At a minimum the NHCE's must receive the same pro rata portion. By the way, I am wondering if Dsyrett's pro rata allocation was just the end result, but that the hoops of Rev Rul 80-229 were jumped through first.