Protected Benefits

[Gary]

Say a participant has an accrued benefit under the plan terms of 50,000.

Say the 415 limit is 30,000.

Now say that the 415 limit has increased to 45,000 as of next plan year.

If the plan amends plan where participant's AB next year is 40,000, is this a violation of anti cutback?

That is, the qualified benefit increased from 30k to 40k, but the Ab of 50k from the prior plan year which would be limited to 45k in the current plan year is not preserved.

Long story short, is the 30k preserved or the 50k (subject to 415) preserved?

Thanks.

[mwyatt]

Not sure of the answer, but the common sense (of course you can get in trouble applying that philosophy) answer would be the AB limited by 415, since he never had the right to receive the original benefit. Could argue the other way too, but the reality (if anyone has bothered to look at any of those monthly asset statements coming in) is that this probably an academic argument since the plan is probably down 30-40% for the year in any event.

Anyone have any pull with the EA meeting planners? Perhaps a good "professional development" seminar would be for a funeral director to coach us in how to present the '09 results...

[AndyH]

Easy. BIOB.

Just blame it on Bush. Everybody asked for relief ......... and Bush said no. Hard to argue with that.