Deceased Terminated Vested Employees

[Guest meggie]

If a Terminated vested employee dies after his NRA and never applied for and therefore never collected a benefit, I would say that the benefit due upon discovery and payable to the estate is the retroactive benefit payments accumulated from NRA to date of death and based on the normal form of annuity. If married at NRA and the normal form is J&S, then I believe the estate is entitled to retroactive J &S payments accumulated from NRA to date of death. If the spouse survived the participant, then would you agree that the spouse (or the spouse's estate) is due the back survivor payments? And lastly, if the spouse is still living, she will continue to receive the survivor annuity until she dies.

This all seems logical, however, I'm confused over the forfeiture rules under 1.411(a)-4(B)(1)- Death. Can someone explain what is being said here and perhaps I need to alter the above analysis?

Thanks

[Guest Harry O]

Look at the plan document. Well-drafted DB plans will require that the employee file a written request for benefits to commence. This is a perfectly legal plan provision. If an employee reaches NRA and fails to file a request for benefits, he continues in deferral status. If he dies, he has died prior to the annuity starting date (as defined in the J&S regulations). He is thus subject to the survivor annuity requirements -- his spouse will receive a QPSA if married and no death benefit is payable with respect to a single participant.

[Guest crosseyedtester]

Back in 2003, a terminated vested participant applied for early retirement benefits. The participant never completed the benefit election form and when he died at age 59 in 2003, had not begun to receive benefits. Now in 2005, the family is asking for survivor benefits for the surviving spouse. Should payments be made retroactive to time of death? Or can they just start now, since he would not yet have been 70 1/2, and since they have only just come forward to make the request?

[david rigby]

Look at the plan document. ... If he dies, he has died prior to the annuity starting date (as defined in the J&S regulations). He is thus subject to the survivor annuity requirements -- his spouse will receive a QPSA if married and no death benefit is payable with respect to a single participant.

Will this answer from HarryO help?

[Effen]

What about actuarial increases? If they were not given a suspension notice, shouldn't the ultimate benefit paid also include actuarial increases from the participant's NRD?

crosseyedtester: Those "googly eyes" are really distracting. I find it difficult to read your posts because my googly eyes are drawn to yours.

[Guest crosseyedtester]

This is a little different than the thread I attached my question to because the terminated vested participant died before NRA.

I guess my question is that I do not understand required annuity starting dates for a surviving spouse for a terminated vested participant between ages 55 and 65 who requested a benefit but did not complete benefit election forms before death. Since the plan was not notified of his death until two years later, does the plan in this case not have to make up payments for that time period?

Early Retirement factors are based on a reduction formula due to number of months retiring early. The calculation was done by determining the 50%J&S benefit at 4/1/05. Is that correct? Or would it be calculated at time of death, and then actuarially increased until 4/1/05 when payments begin? Or rather, caught up back to time of death? Sorry for my confusion.

[AndyH]

HarryO et al told you what to do. Why is that not registering? His advice should answer both your questions, or at least point to the information that is needed to answer your questions. Without it we can only stare at your googleeyes.