Hojo Posted October 1, 2020 Posted October 1, 2020 Does anyone have experience filling out the MP-100 for a missing participant in a cash balance plan? If so, is the present value reported equal to the hypothetical account balance or do you need to calculate a life annuity at normal retirement using the plan assumptions and then convert back using the PBGC assumptions?
david rigby Posted October 1, 2020 Posted October 1, 2020 Might be some prior discussion on that topic. For example, https://benefitslink.com/boards/index.php?/topic/64575-pbgc-missing-participants-program/ I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
Hojo Posted October 2, 2020 Author Posted October 2, 2020 Yeah, no one responded there or had any examples in that thread either. The example I'm working with has a hypothetical balance of ~$11,500 which, using their spreadsheet method, turns into a payment of almost $30,000. That seems a tad excessive.
CuseFan Posted October 2, 2020 Posted October 2, 2020 Try pricing/buying an annuity contract for the equivalent benefit that also includes the lump sum option, I think you'd find similar cost if you could even find a provider. Kenneth M. Prell, CEBS, ERPA Vice President, BPAS Actuarial & Pension Services kprell@bpas.com
Lou S. Posted October 2, 2020 Posted October 2, 2020 Maybe a more extensive search to find the participant might be cheaper?
Hojo Posted October 5, 2020 Author Posted October 5, 2020 We looked at purchasing an annuity but the annuity provider could not locate the participant. Based on their preliminary pricing the annuity cost was significantly less but, again, they couldn't complete the contract. We believe that the participant was possibly using a stolen SSN and false name and currently doesn't want to be found so I doubt this money will ever get to anyone anyway.
david rigby Posted October 5, 2020 Posted October 5, 2020 4 hours ago, Hojo said: We believe that the participant was possibly using a stolen SSN and false name and currently doesn't want to be found ... Is there any possibility this information, assuming it's actually confirmed as fact, could indicate the person was never entitled, under the terms of the Plan, to become an employee and/or participant? (BTW, there are some prior discussion threads on this issue. Use the Search feature.) I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
david rigby Posted October 5, 2020 Posted October 5, 2020 Oops, maybe my statement is hasty. Read the links in this discussion: https://benefitslink.com/boards/index.php?/topic/64109-employer-has-been-notified-of-invalid-ssns/ I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
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