terminating plan

sole proprietor sponsors a one person defined benefit plan.  the plan is overfunded on a lump sum basis but the participant is interested in purchasing an annuity upon plan termination.  i'm aware that an owner can forego receipt of a portion of their benefit in the case when he/she elects a single lump sum.  can the owner elect to forego receipt a portion of his/her monthly benefit to make plan assets sufficient?

for example, the participant who is age 75 (and currently receiving RMDs) is entitled to a $15,000 monthly benefit.  the plan only has sufficient assets to purchase a $14,000 annuity for the participant.  can the participant forego receipt of the shortfall? the sole proprietor is not interesting in making any additional contributions to the plan.

There is nothing to forego.  Upon plan termination the plan will have a provision that only provides benefits to the extent funded.  It just "happens".

Mike is right; in a non-pbgc plan, you SHOULD have language that says the distributions are made "to the extent funded".  Just make sure your plan has that language (I bet it does) and take all the funds and buy the biggest benefit you can that does not exceed the 415 limit.