Individually Designed M/P Pension Plan.

[MBCarey]

We are tryng to update the document for a Money Purchase Pension Plan - Individually Designed. The plan requires a mandatory deferral of 1.5% to be eligible for the 1.5% of match. Does the ACP test have to be run on the match piece?

Also Corbels checklist rfers "Plan Year Switch" for Eligibility Service.

Can someone explain this to me>

mbc

[jaemmons]

Explain to me how a MPP has a deferral feature??

[MBCarey]

In this plan, there is a mandatory employee contribution in order to be eligible for the match.

Do I have to run ADP/ACT? The plan is classified as a Money Purchase Pension Plan

[jaemmons]

The employee contributions are (should be) after-tax. Therefore, you would run the match and employee contributions in an ACP test.

Generally, only MPP established before ERISA can contain a CODA.

If you have a CODA and its effective date is not before 1974, you have don't have a qualified MPP.

[MBCarey]

Thanks, they are post tax contributions so I would need to test both employee and employer together.

Any help with the following.

Also Corbels checklist rfers "Plan Year Switch" for Eligibility Service.

mb

[MBCarey]

Wanted to let you know that I think I understand what the Corbel checklist is asking.

Plan Year Switch - I believe that eligibility initially is based on date of hire and then switches to 1000 per plan year.

mb

[jaemmons]

Yes you are correct. First you look at the anniversary of their date of hire and if they don't meet the 1,000 hours requirement during this period, then you switch to look at the plan year hours which contains their anniversary date of employment:

Eg-Assume calendar year plan

Hire 9-1-01

Work 890 from 9-1-01 to 9-1-02, but 1100 hours from 1-1-02 thru 12-31-02.

Enter the first entry date in 2003.

I hope this helps.