415 Limit and Lump Sum

[Dougsbpc]

Suppose a participant is at the 415 dollar limit, terminates employment and wants a lump sum. In determining the lump sum benefit, the greater of 5.5%, the plan rate or a rate that produces a benefit of 105% of the benefit using minimum value lump sum interest must be used.

Must this same methodology be applied if a participant is not at the dollar limit but is at 100% of final average comp?

[SoCalActuary]

Suppose a participant is at the 415 dollar limit, terminates employment and wants a lump sum. In determining the lump sum benefit, the greater of 5.5%, the plan rate or a rate that produces a benefit of 105% of the benefit using minimum value lump sum interest must be used.

Must this same methodology be applied if a participant is not at the dollar limit but is at 100% of final average comp?

Yes. This is also a 415 limit. Sorry, but I see no exception or distinction.

[Mike Preston]

Suppose a participant is at the 415 dollar limit, terminates employment and wants a lump sum. In determining the lump sum benefit, the greater of 5.5%, the plan rate or a rate that produces a benefit of 105% of the benefit using minimum value lump sum interest must be used.

Must this same methodology be applied if a participant is not at the dollar limit but is at 100% of final average comp?

Yes.