415 limit greater than 417(e) lump sum

[Pension RC]

I am working on one-man (doctor) plan. His normal retirement date is 1/1/2019, when he is 62. However, for some reason, the plan was set up as 10% of average comp per year of participation starting on 1/1/2006. Therefore, he will be fully accrued at 1/1/2016. His 415 lump sum limit is based upon his average comp, which is only about $140,000 (and it is very unlikely that he'll be able to establish a new high-3 average comp, as his recent comps have been low). He would like to terminate the plan 1/1/2015 or 1/1/2016 and be able at that point to take a distribution equal to his 415 lump sum limit. However, since he will only be 58 and 59 on those dates, his 417(e) lump sum will be considerably lower than his 415 limit, as it the 417(e) lump sum will be discounted from age 62. I don't think that it is reasonable to amend the normal retirement age to anything lower than 62. Does anyone have any idea how I can enable him to take a distribution equal to the 415 limit?

Any thoughts would be appreciated!

[Andy the Actuary]

Agree. Don't want to mess with NRD. However, that does not preclude the plan from being amended to provide unreduced early retirement at some earlier age. Then, provided the Plan so provides, you value his accrued pension payable immediately to get your 417(e) lump sum.

[Calavera]

Or amend the lump sum rates as 417(e) rates or some arbitrary rate whichever provide the greater lump sum.