CuseFan

Yes, you have to pay out all benefits first (satisfy liabilities), then the excess (or a portion thereof) may be reverted/transferred to the PSP and placed in an escrow account. To avoid income tax and reversion excise tax, it must be used for the current year and future years' allocations, but you must allocate somewhat equally over a period not longer than 7 years and at least 90% (if I remember correctly) of the active employees of the terminated DB plan must be participants in the PSP. Can 2016 be the first/current year? Maybe, because the DB terminated in 2016 - i don't think IRS would take issue with that - but you would certainly have to start using the excess no later than 2017.