Big Tuna

Okay I think I see your point. Correct me if I'm wrong here - you're saying that you can have such a formula, but need to make sure you have proper backup showing proper plan operation in case of examination? I guess that is a valid design - however it seems to me to "push the envelope" a bit based on this wording from the memo: “However, employer discretion that is not expressly stated in the plan document, and that leads to the manipulation of compensation, may result in operational disqualifying defects. If a Specialist reviewing a plan in the determination letter process has a concern about the employer’s ability to manipulate compensation for the benefit formula, the Specialist might consider a referral to Examination (subject to management approval).” And also based on these comments from the ERISA Outline Book regarding the memo: "Any employer that is considering amending its plan to utilize one of the types of formulas discussed in 6.b.2), 6.b.3) and 6.b.4) below, but without the explicit employer discretion language, should be aware of the potential examination pitfalls and be prepared to maintain records that will show proper plan operation. Practitioners designing these plans also should explore other ways to reach the contribution and benefit goals sought by the plan sponsor that are less likely to raise definitely determinable benefits concerns." Anyway, thanks for the thoughts on this topic.

Doesn't this type of formula go directly against this 2017 IRS memo? Or am I missing some information? Thank you tege-04-0417-0014.pdf

My understanding is that in that scenario, if she took her full SE plan $22,500/month benefit via a lump-sum, her $ limit would then be $7,500 - and the $5,000/month (assuming SLA) would be fine to be paid out of the ME plan. Her full 415 limit would be done as far as the SE plan goes. Except for maybe if her highest-3 limit increased in the future.

It'd be $22,500/month because you don't aggregate benefits in ME plans with benefits in SE plans for the comp limit (only for the $ limit). Note that the portion of the dollar limit that is being paid (has already commenced) shouldn't be increased for delayed commencement (beyond age 65). So, if $5K/month started at age 65 as a SLA, that part of the $ limit wouldn't increase.

It would be that the annuity payments are not eligible for rollover. No exception for the term less than 10 years since passed RBD. And assuming the entire vested benefit is being paid on the 5-year term certain.

Can't roll annuity payments. Believe that's in 402c Edit: Agree with NJ Mike.