meaningful benefit

[Tom Poje]

how is one allowed to calculate whether a plan provides a meaningful benefit?

looking at a cash balance plan that uses the GATT rate in the calculation to avoid the whipshaw effect at payout time.

when determining if participants receive at least .5% does one also use the same assumptions (e.g. the GAR mortality at the GATT interest) or is one allowed to use any standard mortality table and interest rate?

[Mike Preston]

I don't have Paul Shultz' memo handy, but IIRC it dealt with the provision of benefits, not the measure of benefits against a theoretical threshold for purposes of, say, non-discrimination. Hence, I would go with GATT unless I was shown something that indicated the more lenient calculations would be acceptable.

[Effen]

I agree with Mike. It's not a testing issue, its a benefit issue. Your Plan doc should contain process to convert the hypothetical cash balance account to a monthly benefit, generally this will use GATT assumptions. Once you determine the value of the hypothetical cb account, you can check it against Paul Shultz's .5% minimum.