MAP-21

[Dougsbpc]

A plan document interim amendment was signed 12/31/2012. As part of this good-faith interim amendment, the plan was amended effective for plan years beginning in 2012 to incorporate MAP-21 provisions and rates. As part of the amendment, a plan sponsor could elect to delay MAP-21 to plan years beginning in 2013 or to apply the MAP-21 provisions just for the AFTAP.

Question: must there be a written election to the plan actuary to use the MAP-21 rates? Or does the signed amendment incorporating those rates suffice?

Thanks.

[Effen]

The default was to use MAP-21. Plan sponsors could elect NOT to use MAP-21 in 2012. This was done with a written election to the actuary. Since MAP was passed so late in the year, many 2012 valuations had already been completed based on the PPA rules. In order to avoid requiring everyone to redo their 2012 valuations, the sponsors were permitted to defer the impact for funding until 2013.

I would argue the funding elections have nothing to do with the good faith amendment.

[Rball4]

MAP-21 was the law. You only needed an election form to opt out of it for the 2012 plan year.

[Dougsbpc]

Thanks for the clarification.

What about a plan that used the full yield curve prior to 2012?

Was there a special election that had to be signed by July 5, 2013 to revoke use of the full yield curve effective for 2012 and future years? What if the interim amendment was signed prior to July 5, 2013?

[david rigby]

See IRS Notice 2012-61, http://www.irs.gov/irb/2012-42_IRB/ar10.html

Q&A E4 and E5.

[Effen]

The interim amendment has nothing to do with the funding election.