Actuarial Equivalence

[Guest Nini]

We have a client that generally uses te GATT rates, however, if a participant works until normal retirement age and then retires, the lump sum is determined on the basis of the greater of the GATT rate or the PBGC rate with a 4 year setback. Currently, the PBGC rate provides a better benefit.

The question is, could the PBGC rate be eliminated for anyone who has not yet reached NRD without having to guarantee that the benefit earned to date would be subject to that provision?

Any guidance/regulations is appreciated - thanks.

[Mike Preston]

No.

[John Feldt ERPA CPC QPA]

Is this a government plan or is this a nonelecting church plan?

[Guest Nini]

No, this is an ERISA plan.

[John Feldt ERPA CPC QPA]

Ok. If your client really wants you to come up with something, you could file a form 6406 to see if the IRS might allow the amendment (be sure to explain it fully to the IRS). Tell your client it's a long shot, but you never know what kind of language the IRS might allow to go through. It seems unlikely they would allow that (see Mr. Preston's comment).

I assume the IRS still accepts Form 6406 filings?