Search the Community
Showing results for tags 'late ret'.
Found 1 result
-
actuarial increases for deferred vested participants
Guest posted a topic in Defined Benefit Plans, Including Cash Balance
Hello all, I'm back in the defined benefit arena after an extended time period. I have a client who says their actuarial equivalence definition is based on 417(e) segment rates with a 3-month look back, so October, 2014 segment rates are used for benefit commencement dates in 2015. Is it permissible to apply an actuarial increase using 417(e) segment rates at the time of commencement? For example, they have a vested term who reached NRA in 2008 and wants a BCD of 1/1/2015. they want to use the October, 2014 segment rates for the whole increase. I'm seeing some unusual changes in the late retirement benefit at 12/1/2014 vs. 1/1/2015. Because of the change in segment rates from October 2013 to October 2014, the late retirement increase at 1/1/2015 is less than the late retirement increase at 12/1/2014. So the resulting benefit at 1/1/2015 is less than what the benefit would have been at 12/1/2014. Does anyone know if this is permissible under the most recent IRS Regs? Any guidance would be much appreciated.