Mike Preston

I thought it was coherent. And appreciated.

According to my discussions with various PBGC representatives the plan you describe is exempt from coverage. If you have any doubt, you can submit a coverage determination request to the PBGC.

What he said.

Rate banding doesn't really work. If you need it to pass, generally, then you aren't eligible to use it!

You were, huh? Pretty amazing. Just before 9/15 and 10/15 is probably not the best time to be looking for lengthy tutorials on new endeavors. Especially since, and I apologize in advance for what will seem like an unkind thing to say, you have trouble with such elementary concepts. So, before you respond, review what you originally said, how I responded and then your most recent response. Does something strike you as kind of odd?

It sounds like the assumptions that are being used in the document to determine the age-weighted allocations are different from the assumptions being used to run the general test. If the age-weighted allocation uses 401(a)(4) compliant assumptions, the allocation is done correctly, and the general test is run using those same assumptions then there will be exactly one rate group and each HCE and NHCE will have the same EBAR and therefore all will be in that same rate group. Before you jump to the conclusion that the fact that no general test was run last year leads to something that requires fixing, make sure you have something to fix!

Lexus, your determination is laudable. And I wish you luck, but you are asking a lot of people here to respond to so many questions at once. What if you tried to do it in bite size pieces? Anything that folks can answer within a few minutes. I'll bite off the first piece: "-Accrued Plan Benefit = $2,807, which appears to be calculated using 5% & 1994 GAR Is there any specific reasons why the 5% &1994 assumption used?" Unless things are very strange in your document, there is absolutely no tie between the calculation of the accrued benefit and a set (any set) of actuarial assumptions. None. So, it is difficult to answer the actual question you posed because it is based on a false premise. The assumptions you mention might be the assumptions required in the case where a participant reaches one year beyond NRA (73 in your example) to determine the actuarially equivalent benefit commencing at age 73 equal to what was accrued at age 72. If it is, then the answer to your question is one that you will get over and over again: RTFD [Read the fantastic document].

It is indeed! I had forgotten there were limited exceptions to the general rule. Thanks!

I doubt you are wrong.

How are the two legally different?

Thought brevity was called for (and I was typing on a tablet). I'm sorry you don't want to submit. There are no amendments I'm aware of that are meant to fix things that can be handled under SCP. [And before someone shouts -11g at me, keep in mind that isn't a SCP issue; it is specifically authorized by the reg.] So, sorry, but if you are doing a retroactive amendment you have to submit under EPCRS. Am I wrong on this? Did the latest (2015) changes to EPCRS authorize certain retroactive amendments to conform the plan document to actual plan operation in certain circumstances without a required VCP filing? Nothing would surprise me.

What part of sorry is unclear?

Sorry.

Seriously?

Then hopefully the document you choose will allow what you want.

I agree they don't *have* to be. But the document language controls and it may indicate otherwise.

I love it when people state what they "know" but what they know is, well, not what others know! As Tom points out, and as your question makes clear, there is no such requirement and, if there were, it would render restructuring a meaningless concept. What you may be confusing is the "requirement" to test a DC plan on contributions and the DB plan on benefits if you are trying to use 1.410(b)-5(e)(3) to run the ABT separately for the DC plan and the DB plan.

Ah, OK.

The results can surprise you. Assume you hire somebody (and give them periodic account statements [assume monthly, for example]) and they find the following (admittedly extreme) facts: Value as predetermined in April of 2012: $48,812 Value determined as of April of 2013: $0 [i said it was extreme] Value as of May 2013 after $30,994 contribution made on May 1, 2013: $30,994 Value as of May 1, 2014: $104,819 Under those facts, magically (and sadly) 100% of the account is now attributable to the marital period and your spouse is entitled to 1/2 of the total: $52,409!!!!! So, how the Gain/Loss presents itself over time and the timing of the actual contributions can lead to a result of somewhere between $15,497 [also an extreme example, but the other direction] and $52,409!!!!! By the way, the fact that you are asking a question as to how the amount is to be determined is evidence of the fact that the language of your settlement agreement, if copied into a domestic relations order, should be rejected by the plan because they would have those same questions. Best to tighten up the language a bit before having the DRO presented to the plan. In order to do it efficiently, you would need to know whether the accounts are individually directed or whether some portion of the plan uses pooled investments. If the former, how often are statements made available and how many of those have you kept? If the latter, how often does the plan value the funds (probably annually, but I've seen quarterly)? Is there a mixture of the two? You also need to know whether the company made any contributions for the 2013 or 2014 years after 5/1/2014 and agree what portion of those amounts should be marital (usually 100% for contributions attributable to 2013 and 33.33% for those attributable to 2014). Good luck!

SHNEC! Vesting?

The qualification issue is the failure to vest. I understand that the IRS takes the position that full vesting must take place as of the date that the "decision" was made to stop contributing. And that date is "deemed" to be the date that the last contribution was made. So, it becomes a qualification issue, with retroactive application (which, I might add, can be entirely illogical to apply in practice), if the IRS discovers it on audit.

Tom, when I got it, it already had a cell that was used to determine the share of gross profits applicable to the one owner/partner that was being calculated, so somebody at some point thought it was for more than the simple case of a single owner.

It would "work", but it would be unwieldy. It is geared to one worksheet per owner. 140 worksheets is a pain. How many non-owners? Are the non-owner contribution amounts pre-determined or does the spreadsheet have to calculate the non-owner contribution amounts? How is the expense of the non-owner contributions shared? In the same ratio as the profit interest for all non-owner contributions? Or are there certain non-owners who are charged against a particular owner at a rate which is different from the profit interest? The worksheet has no capability to adjust for unreimbursed partnership expenses. Or to apply Section 179 expenses in a manner other than, in the aggregate, reducing the Gross Profit (which is the same thing as charging them to each owner in the same ratio of the profit interest).

It is whatever the plan says.

Sigh. If you have a partial 436 restriction that doesn't magically create a partial lump sum option under the plan. I haven't looked at a 436 amendment recently but I don't recall it saying anything like: "Even if plan doesn't allow partial cash-outs because a full cash-out is restricted the plan now allows a partial cash-out." Am I wrong?