Coverage Testing

[Chippy]

I have two plans, a controlled group. One plan, a 401(k) Plan, has a 12/31 PYE. The other plan, a money purchase pension plan, has a 9/30 PYE. Since the plans have different plan year ends, I realize that I have to do the average benefits test to pass coverage. In 2011, the MPPP changed their plan year end to 12/31. After 2011, I should be able to do the 410b test to pass coverage. For 2011, I'll do one test for the 12/31/2011 PYE in the 401(k) and the 9/30/2011 PYE in the MPPP? But how would I test the 12/31/2011 short plan year for the MPPP?

[MWeddell]

Have you tried just performing a ratio percentage test on each plan? I'm not sure why you'd go straight to performing an average benefit test just because the plan years differ.

[Chippy]

Have you tried just performing a ratio percentage test on each plan? I'm not sure why you'd go straight to performing an average benefit test just because the plan years differ.

If the plans have different plan year ends, then you can not do a combined ratio percentage test. That was in the ERISA outline book. THe 9/30 plan year changed to a 12/31 plan year end, so going forward I can do the ratio percentage test, I just don't know how to test the short plan year.