Lump sum changed from PBGC rates to 120% PBGC rates

[Gary]

Ee terminates 2/2/93. Plan amends lump sum factors from PBGC rates to 120 % PBGC rates (for dist > 25,000) on 5/1/93 (adopted 5/11/93). Payout is 6/1/93.

Should ee be entitled to PBGC rates since her termed < 5/1/93?

Is this change a 411(d)(6) violation? The 417 (e) law prior to GATT said that if a plan adopts plan amendment related to 417(e) and PBGC rates, before end of 1989 plan year it is not a 411(d)(6) cutback. Of course this plan amendment took place in 1993. Appreciate any comments.

Gary

[Guest]

Yes, this is a prohibited cutback.