nancy Posted October 23, 2001 Posted October 23, 2001 May a plan with more than 100 participants whose RPA current liability is more than 90% funded or meets the volatility requirements deduct the difference between the assets and the RPA current liability? Or do you have to be actually subject to the AFC?
Guest Keith N Posted October 23, 2001 Posted October 23, 2001 They don't have to be subject to AFC, so deduct away! I use the projected end of year numbers, but I recognize that there isn't any real clear guidance. I do the same calculation as I would to determine the AFC using the transition rule, but substitute 100% as the "target percentage".
david rigby Posted October 23, 2001 Posted October 23, 2001 Again, Keith is correct. The unfunded CL is a minimum to the deductible limit, for plans with more than 100 participants. See IRC 404(a)(1)(D). The AFC issues are not relevant. I also agree that this amount is determined as of the end of the plan year. I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
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