Freeze

[DBnme]

Calendar year DB plan with approx. 50 participants. Covers all employees, 21 & 1 eligibility. 1000 hours required for accrual. Plan sponsor is considering freezing for 2020 but it may be that 3 or 4 participants will have worked 1000 hours by the freeze date. How will that work for 401(a)(26)? Does the fact that a few participants accrue nullify the frozen plan exemption? Note that the plan is slightly underfunded on a plan termination basis.

[CuseFan]

I think you may be OK if none of those earning an accrual is an HCE, otherwise, you may have to amend (if no fail safe language) in some fashion to provide accruals, like lowering the hours requirement to the extent necessary to benefit 40%.

[Barbara]

Is anyone aware of any requests to the IRS to delay minimum funding requirements for DB Plans?