Lump sum distributions with AFTAP cert less than 60%

I have a Plan that keep waivering between 70% and less than 60% depending on the contributions deposited (or not deposited) by the plan sponsor.  Election Forms for a bifurcated lump sum were sent out to eligible terminated participants.  The participant signed and returned their election form a few days before the new AFTAP was certified below 60%.  Can we proceed with the payout on the basis that it was signed and received by the plan sponsor prior to the new certification?

I am far from an expert on Section 436, but since no one else has responded, here is my view (with the major caveat that an actuary really needs to answer this question):  My general understanding is that once an AFTAP is certified, it applies to all distributions with an annuity starting date on or after the AFTAP certification date.  So its the annuity starting date, not the date of signature that controls. If the annuity starting date is after the AFTAP certification, then I think the less than 60% applies. Again, I'm not an actuary...

Thank you for the response.  That is certainly the safest approach.

4 hours ago, FORMER ESQ. said:

If the annuity starting date is after the AFTAP certification, then I think the less than 60% applies

Yes, the 436 restriction is based on the annuity starting date. Looking at IRC 417(f)(2)(A), for a LS the ASD is not the date of the payment, it is the date when all events entitling the participant to the payment have occurred.  

(A)The term “annuity starting date” means— (i)the first day of the first period for which an amount is payable as an annuity, or (ii)in the case of a benefit not payable in the form of an annuity, the first day on which all events have occurred which entitle the participant to such benefit. (B)For purposes of subparagraph (A), the first day of the first period for which a benefit is to be received by reason of disability shall be treated as the annuity starting date only if such benefit is not an auxiliary benefit.

If all election forms were completed and properly executed with spousal consent if applicable, and all were received by the Plan Administrator prior to the date the AFTAP was received, AND the date at which the lump sum was valued (typically shown as the ASD on election forms) was also prior to receipt of that AFTAP, then I think the ASD precedes the AFTAP and the bifurcated LS portion could be paid. For example, forms for 9/1 ASD on bifurcated benefit went out in July, received back by the PA on 9/11, fully and properly executed, and then on 9/14 the PA receives the AFTAP, I think the distribution can and should go forward.