Restricted EE also a Beneficiary

[Guest jody303]

An HCE and his spouse both participate in the same DB plan, which is underfunded. Plan does not pay lump sums. Both are restricted employees under 1.401(a)(4)-5(b).

Spouse recently died. Participant is entitled to the QPSA commencing at the deceased spouse's NRA. The participant will reach his NRA at about the same time. 1.401(a)(4)-5(b)(3) says "...the payment of benefits to or on behalf of a restricted employee...."

Because of the "on behalf of" phrase, I believe the participant can receive his full life annuity amount annually, as well as the survivor portion of his spouse's benefit. The combined amounts would exceed his unrestricted amount alone. But I think he can get his unrestricted amount plus an amount not to exceed his spouse's unrestricted amount (which the QPSA would obviously not exceed). Is this correct?

Thanks in advance for all responses.

[Everett Moreland]

With no more authority than you have, I agree with your analysis and conclusion.

[MGB]

I agree (and have no additional sites).

[Guest jody303]

Thank you Everett and MGB for your opinions. It's nice to get some reassurance from others when there isn't any clear published guidance.

Thanks again.