Age calculation under 415(B) for early payment

[Guest MattL]

Is there a prescribed method for determining the Participant's retirement age under Section 415(B) for adjusting the DB benefit limit to an age earlier than the Social Security Retirement Age? In other words, is there a required method of exact age, nearest age, etc?

Thanks.

[david rigby]

Yes. Use age without regard to the SS phase-in.

Year of birth SSNRA

1938 or earlier: 65

1939 - 1954: 66

1955 or later: 67

[Guest MattL]

Thanks for your reply. What I am really concerned about is the age determination as of the commencement date. FOr instance, if a Participant is exactly age 59, 3 months, and 12 days as of the date his payment will begin, is he 59 and 3 months or 59 and 4 months for the reduction of the benefit limit from 62?

[david rigby]

I suggest using the age on the commencement date and compare to the SSNRA. I usually think of both of those dates as "the first day of the month following." In this case, the age will always be interpolated to X years and Y months. Days will no longer be relevant.

But caution, this oversimplification is because most plans define any payment commencement date as the first of a month. Check carefully with your plan.