Renee H Posted October 22 Posted October 22 I recently inherited DB/401k combo plans. The company is an LLC and currently has only included the husband's partnership income for benefit purposes (wife has never participated). For 2025, they want to bring in the wife and daughter. Will this cause the DB plan to require PBGC coverage?
thepensionmaven Posted October 23 Posted October 23 Regrettably, I believe it would. Have had this same situation multiple times.
Effen Posted October 23 Posted October 23 Not always "regrettable" since you do get a higher combined plan deduction limit with PBGC coverage, but yes, another layer of requirements, especially upon plan termination. The material provided and the opinions expressed in this post are for general informational purposes only and should not be used or relied upon as the basis for any action or inaction. You should obtain appropriate tax, legal, or other professional advice.
david rigby Posted October 23 Posted October 23 Any possibility that the "professional service employer" exemption could apply? 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.
Jakyasar Posted October 23 Posted October 23 When in doubt, have PBGC make the determination (you can check on their website). I have had multiple applications for determination and got different determinations. Depends on the kind of the business as well as professional licenses held by the business owner. acm_acm 1
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