415 Comp Limit

[Pension RC]

I have a one-person plan, effective 1/1/2011, which bases compensation on comp prior to 1/1/2011. When calculating the 415 comp limit, do I include comp after 1/1/2011?

Any help would be appreciated!

[Effen]

I would say yes.

Did the participant accrue any benefits after 1/1/2011? If so, than I think post 2011 comp would definitely count in determining the 415 limit.

[david rigby]

It depends. When you say, "...comp prior to 1/1/2011...", are referring to a plan freeze? If so, review the terms of the amendment that executed that freeze.

[Pension RC]

Actually, the original plan document, effective 1/1/2011, defines compensation as excluding comp after 12/31/2010. It also defines benefit service as including service prior the effective date. Since the benefit formula is 10% for 10 years of service, and the participant has a date of hire of 1/1/73, he was fully accrued at 1/1/2011 and there were no accruals after 1/1/2011. Now that I'm thinking about it, if they didn't hit the 415 limit on 1/1/2011, then they won't hit it going forward, so I guess my question isn't relevant.

[david rigby]

Just in case you haven't included this, the 415 dollar limitation accrues over (minimum 10) years of participation (in your case, that begins 1/1/2011), while the 100% of pay limitation accrues of (minimum 10) years of service.