General testing a cash balance plan

[FAPInJax]

The most valuable benefit is generally calculated by converting the account balance into a J&50 annuity payable immediately using the plan's actuarial equivalent assumptions and then back to a life annuity using testing assumptions.

Does this methodology still apply IF a participant is beyond normal retirement age (testing age)?? Or can the most valuable just be determined using the plan's AE assumptions?

[SoCalActuary]

This problem of handling late retirees for cross-testing is troublesome, since the solutions offered will skew the results of the test in different ways. Cash balance plans are tested as DB plans, but allocate like DC plans.

Choice one is to value them at current age, using the current APR for the plan rate to convert to an annuity benefit. The annuity benefit is then tested on J&S at current age for MV benefit.

Choice two is to value them using the testing age (e.g. 65) as in DC plans. How then do you determine the ages for the J&S benefit?

Frankly, I don't know if the IRS has considered this fully. Can you get an opinion from Ed Burrows, Larry Deutsch, or even better from the IRS?