415 lump sum question

[Mister Met]

cash balance plan

ppt is age 70

3-year average comp is 250k (2013, 2012, 2011)

415 dollar limit of $205,000, actuarially increased from 65 to 70 exceeds the $250,000 comp limit

cash balance account is $3 million

life annuity under plan's formula without regard to 415 is $257,000/year

plan's actuarial equivalence is 3-segment rates/IRS mortality for 2013

Is the max 415 lump sum equal to the lesser of

1. $3 million

2. $250,000 x lump sum factor using 5.5%

3. $250,000 x lump sum factor using plan's basis?

thanks

[Effen]

I vote 2. Around $2.5M and DECREASING.

They should at least be receiving the monthly annuity until they can get the plan terminated. Every day they wait, they are just loosing money.

[Calavera]

I agree with Effen. Moreover, when you are over NRD and an actuarial equivalent of your benefit is higher than the 415 limit, you either need to implement a suspension of benefit or you need to implement in-service distribution.