RMD from DB plan facing 436 restriction

[dmb]

a participant in a DB plan is actively employed and currently receiving minimum distribution payments as a lump sum. At the time their initial payment was made (3/08) and also when the 1/09 and 1/10 top-offs were paid this plan was at least 80% funded. Now we are about to pay the 1/11 top-off and this plan is currently funded between 60% and 80%. Can the 1/11 top-off be paid since at the time of their BCD (3/08) the plan was not restricted, or do the funding restriction now apply to the portion of the benefit payable attributable to the 2010 accruals? Any help would be appreciated. Thanks.

[Andy the Actuary]

"Under section 436(d)(5), a prohibited payment is (1) any payment in excess of the monthly amount paid under a single

life annuity (plus any social security supplements that are provided under the plan) to a participant or beneficiary,

(2) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, or (3) any other payment

specified by the Secretary by regulations"

[AndyH]

a participant in a DB plan is actively employed and currently receiving minimum distribution payments as a lump sum. At the time their initial payment was made (3/08) and also when the 1/09 and 1/10 top-offs were paid this plan was at least 80% funded. Now we are about to pay the 1/11 top-off and this plan is currently funded between 60% and 80%. Can the 1/11 top-off be paid since at the time of their BCD (3/08) the plan was not restricted, or do the funding restriction now apply to the portion of the benefit payable attributable to the 2010 accruals? Any help would be appreciated. Thanks.

I don't understand the question. What do you mean by "currently receiving minimum distribution payents as a lump sum"? How does that work? The minimums should represent amounts based on life expectancy, at most, so how would these exceed the life annuity amount not subject to the 436 restriction?