Need help please

[AndyH]

name='tymesup' date='Aug 29 2008, 03:25 PM' post='167949']

Here is the last sentence of the HOLDING:

If, instead, the accruals

are earned under a new plan maintained

by the same employer and the new plan is

merged with the frozen plan, then this holding

also applies, so that, after the merger,

service after the frozen plan was established

must be taken into account for purposes

of vesting in any benefit accruals under

the new plan.

Note the Holding says service after the frozen plan was established must be counted under the NEW plan.

Agreed, But this is iff there is a MERGER.

It is also true if a frozen plan is unfrozen but that seems like stating the obvious to me.

This does not address the maintenance of two separate plans, which means those rules go to 411 and there is no prohibition of starting vesting service on the effective date of a particular plan as long as the first plan has not been terminated within 5 years.

[tymesup]

I agree the Rev Ruling does not address this particular situation - freeze, new plan established, no merger.

Under Law and Analysis, the second paragraph says to generally count all years of service for vesting. It then provides an exception for any period when the employer did not maintain a predecessor plan.

The Rev Ruling clarifies that a freeze/partial termination does not mean that a plan was not maintained.

The question then comes down to whether the frozen plan is a predecessor plan.

Agreed?

[AndyH]

I agree the Rev Ruling does not address this particular situation - freeze, new plan established, no merger.

Under Law and Analysis, the second paragraph says to generally count all years of service for vesting. It then provides an exception for any period when the employer did not maintain a predecessor plan.

The Rev Ruling clarifies that a freeze/partial termination does not mean that a plan was not maintained.

The question then comes down to whether the frozen plan is a predecessor plan.

Agreed?

Issue 1 yes.

Issue 2 is what about people (non salaried) who were not in Plan A. Why would they be affected.

BTW. just got an acknowledgement that this question has the biggest' wigs attention. All I wanted was a couple of quick replies that I'm right!! (Honestly I thought it was that straight-forward-still do.)

[Blinky the 3-eyed Fish]

BTW. just got an acknowledgement that this question has the biggest' wigs attention.

It has the attention of Elton John?

[AndyH]

Much much bigger.

[Blinky the 3-eyed Fish]

I don't know. It's close. He definitely has Amy beat.

[AndyH]

Just found out I won my appeal and the official answer is being changed to False. Thanks to all who commented.

.......But I also found out the scoring isn't what was officially posted (long story) so I need another appeal (which I am prepared for but didn't think I needed to submit).....in the works.... a few more months I guess. Fun fun. Maybe while I wait I'll grow my hair like Blinky's err Mother?

[stephen]

Congrats and good luck!

[Guest Sieve]

What was the question again . . .??!!?? Well done!!

[Andy the Actuary]

To quote the ghost of Grandma Tzeitl in Fiddler on the Roof, "A blessing on your head, mazel tov, mazel tov."

[tymesup]

Just found out I won my appeal and the official answer is being changed to False. Thanks to all who commented.

.......But I also found out the scoring isn't what was officially posted (long story) so I need another appeal (which I am prepared for but didn't think I needed to submit).....in the works.... a few more months I guess. Fun fun. Maybe while I wait I'll grow my hair like Blinky's err Mother?

Congratulations, illegitamati non carborundum.

[AndyH]

That could be useful.

[Andy the Actuary]

illegitamati non carborundum.

Doc said I had to cut this out as well as other pasta dishes.

[Blinky the 3-eyed Fish]

And of course follow this sage advice:

Vitanda est improba siren desidia

[Andy the Actuary]

And of course follow this sage advice:

Vitanda est improba siren desidia

And this means? "atwhay emay orryway"

[Guest MERISA]

I know I'm 7 years late to the party and on congratulating the test passer, but I wanted to add that it is apparently common practice for an existing plan to be frozen and a new ESOP to be established (to cash-out the owner) and for service prior to the establishment of the ESOP to be excluded for vesting purposes under the ESOP. The frozen plan is maintained until the 5-year post is passed, then it's terminated. If a frozen plan is not a terminated plan under 1.411-a(5)(b)(3)(ii), then this works because it is not a predecessor plan for vesting purposes, but I would suggest that this quacks like a "subterfuge."

(I'm looking at this issue right now which is how I stumbled across this thread in the first place. As usual, one of the only places where I could find a thoughtful discussion of a gray issue in the minutiae of the employee benefits regulatory web. Thank you all for your posts!)