Current through Register Vol. 50, No. 9, September 20, 2024
F.
Definitions
415 Safe-Harbor Compensation-
a. Compensation is defined as wages,
salaries, and fees for professional services and other amounts received
(without regard to whether or not an amount is paid in cash) for personal
services actually rendered in the course of employment with the employer
maintaining the plan to the extent that the amounts are includible in gross
income (including, but not limited to, commissions paid salespersons,
compensation for services on the basis of a percentage of profits, commissions
on insurance premiums, tips, bonuses, fringe benefits, and reimbursements, or
other expense allowances under a nonaccountable plan (as described in section
1.62-2(c) of the income tax regulations), and excluding the following:
i. employer contributions [other than
elective contributions described in section 402(e)(3), section 408(k)(6),
section 408(p)(2)(A)(i), or section 457(b)] to a plan of deferred compensation
(including a simplified employee pension described in section 408(k) or a
simple retirement account described in section 408(p), and whether or not
qualified) to the extent such contributions are not includible in the members
gross income for the taxable year in which contributed, and any distributions
(whether or not includible in gross income when distributed) from a plan of
deferred compensation (whether or not qualified);
ii. amounts realized from the exercise of a
nonstatutory stock option (that is, an option other than a statutory stock
option as defined in section 1.421-1(b) of the income tax regulations), or when
restricted stock (or property) held by the member either becomes freely
transferable or is no longer subject to a substantial risk of
forfeiture;
iii. amounts realized
from the sale, exchange or other disposition of stock acquired under a
statutory stock option;
iv. other
amounts that receive special tax benefits, such as premiums for group-term life
insurance (but only to the extent that the premiums are not includible in the
gross income of the member and are not salary reduction amounts that are
described in section 125);
v. other
items of remuneration that are similar to any of the items listed in Clauses i
through iv above.
b. For
any self-employed individual, compensation shall mean earned income.
c. Except as provided herein, for limitation
years beginning after December 31, 1991, compensation for a limitation year is
the compensation actually paid or made available during such limitation
year.
d. For limitation years
beginning on or after July 1, 2007, compensation for a limitation year shall
also include compensation paid by the later of 2 1/2 months after an members
severance from employment with the employer maintaining the plan or the end of
the limitation year that includes the date of the members severance from
employment with the employer maintaining the plan, if:
i. the payment is regular compensation for
services during the members regular working hours, or compensation for services
outside the employees regular working hours (such as overtime or shift
differential), commissions, bonuses, or other similar payments, and, absent a
severance from employment, the payments would have been paid to the member
while the member continued in employment with the employer;
ii. the payment is for unused accrued bona
fide sick, vacation or other leave that the member would have been able to use
if employment had continued; or
iii. the payment is received by the member
pursuant to a nonqualified unfunded deferred compensation plan and would have
been paid at the same time if employment had continued, but only to the extent
includible in gross income.
e. Any payments not described above shall not
be considered compensation if paid after severance from employment, even if
they are paid by the later of 2 1/2 months after the date of severance from
employment or the end of the limitation year that includes the date of
severance from employment. Back pay, within the meaning of section
1.415(c)-2(g)(8), shall be treated as compensation for the limitation year to
which the back pay relates to the extent the back pay represents wages and
compensation that would otherwise be included under this definition.
f. For limitation years beginning after
December 31, 1997, compensation paid or made available during such limitation
year shall include amounts that would otherwise be included in compensation but
for an election under sections 125(a), 402(e)(3), 402(h)(1)(B), 402(k), or
457(b).
g. For limitation years
beginning after December 31, 2000, compensation shall also include any elective
amounts that are not includible in the gross income of the member by reason of
section 132(f)(4)
h. For limitation
years beginning after December 31, 2008, compensation shall also include any
differential wage payments as defined in code section 3401(h) which:
i. is made by the employer to an individual
with respect to any period during which an individual is performing service in
the uniformed services (as defined in chapter 43 of title 38, United
States Code) while on active duty for a period of more than 30 days;
and
ii. represents all or a portion
of the remuneration such individual would have received from the employer if he
or she was performing services for the employer.
Annual Benefit - a benefit that is payable
annually in the form of a straight life annuity. Except as provided below,
where a benefit is payable in a form other than a straight life annuity, the
benefit shall be adjusted to an actuarially equivalent straight life annuity
that begins at the same time as such other form of benefit and is payable on
the first day of each month, before applying the limitations of this article.
For a member who has or will have distributions commencing at more than one
annuity starting date, the annual benefit shall be determined as of each such
annuity starting date (and shall satisfy the limitations of this chapter as of
each such date), actuarially adjusting for past and future distributions of
benefits commencing at the other annuity starting dates. For this purpose, the
determination of whether a new starting date has occurred shall be made without
regard to section 1.401(a)-20, Q and A 10(d), and with regard to section
1.415(b)1(b)(1)(iii)(B) and (C) of the income tax regulations.
a. No actuarial adjustment to the benefit
shall be made for:
i. survivor benefits
payable to a surviving spouse under a qualified joint and survivor annuity to
the extent such benefits would not be payable if the members benefit were paid
in another form;
ii. benefits that
are not directly related to retirement benefits (such as a disability benefit,
preretirement incidental death benefits, and postretirement medical benefits);
or
iii. the inclusion in the form
of benefit of an automatic benefit increase feature, provided the form of
benefit is not subject to section 417(e)(3) of the Internal Revenue
Code and would otherwise satisfy the limitations of this chapter, and
the plan provides that the amount payable under the form of benefit in any
limitation year shall not exceed the limits of this chapter applicable at the
annuity starting date, as increased in subsequent years pursuant to section
415(d) For this purpose, an automatic benefit increase feature is included in a
form of benefit if the form of benefit provides for automatic, periodic
increases to the benefits paid in that form. The determination of the annual
benefit shall take into account social security supplements described in
section 411(a)(9) of the Internal Revenue Code and benefits
transferred from another defined benefit plan, other than transfers of
distributable benefits pursuant section 1.411(d)-4, Q and A-3(c), of the income
tax regulations, but shall disregard benefits attributable to employee
contributions or rollover contributions. Effective for distributions in plan
years beginning after December 31, 2003, the determination of actuarial
equivalence of forms of benefit other than a straight life annuity shall be
made in accordance with §401.F.1 b
b. Benefit Forms Not Subject to Section
417(e)(3)
i. The straight life annuity that is
actuarially equivalent to the members form of benefit shall be determined under
this Subparagraph F.1.b, if the form of the members benefit is either:
(a) . a non-decreasing annuity (other than a
straight life annuity) payable for a period of not less than the life of the
member (or, in the case of a qualified preretirement survivor annuity, the life
of the surviving spouse); or
(b) .
an annuity that decreases during the life of the member merely because of:
(i) . the death of the survivor annuitant
(but only if the reduction is not below 50 percent of the benefit payable
before the death of the survivor annuitant); or
(ii) . the cessation or reduction of Social
Security supplements or qualified disability payments [as defined in section
401(a)(11)].
ii. Limitation years beginning before July 1,
2007. For limitation years beginning before July 1, 2007, the actuarially
equivalent straight life annuity is equal to the annual amount of the straight
life annuity commencing at the same annuity starting date that has the same
actuarial present value as the members form of benefit computed using whichever
of the following produces the greater annual amount:
(a) . the interest rate specified in
R.S.
11:1171 and the mortality table (or other
tabular factor) specified in
R.S.
11:1171 for adjusting benefits in the same
form; and
(b) . a 5 percent
interest rate assumption and the applicable mortality table for that annuity
starting date.
iii.
Limitation Years beginning on or after July 1, 2007. For limitation years
beginning on or after July 1, 2007, the actuarially equivalent straight life
annuity is equal to the greater of:
(a) . the
annual amount of the straight life annuity (if any) payable to the member under
the plan commencing at the same annuity starting date as the members form of
benefit; and
(b) . the annual
amount of the straight life annuity commencing at the same annuity starting
date that has the same actuarial present value as the members form of benefit,
computed using a 5 percent interest rate assumption and the applicable
mortality table for that annuity starting date.
c. Benefit Forms Subject to Section 417(e)(3)
The straight life annuity that is actuarially equivalent to the members form of
benefit shall be determined under this paragraph if the form of the members
benefit is other than a benefit form described in §401.F.1.b In this case, the
actuarially equivalent straight life annuity shall be determined as follows:
i. Annuity Starting Date in Plan Years
Beginning After 2005. If the annuity starting date of the members form of
benefit is in a plan year beginning after 2005, the actuarially equivalent
straight life annuity is equal to the greatest of:
(a) . the annual amount of the straight life
annuity commencing at the same annuity starting date that has the same
actuarial present value as the members form of computed using the interest rate
specified in
R.S.
11:1171 and the mortality table (or other
tabular factor) specified in
R.S.
11:1171 for adjusting benefits in the same
form;
(b) . the annual amount of
the straight life annuity commencing at the same annuity starting date that has
the same actuarial present value as the members form of benefit, computed using
a 5.5 percent interest rate assumption and the applicable mortality table
defined in.
R.S.
11:1171; and
(c) . the annual amount of the straight life
annuity commencing at the same annuity starting date that has the same
actuarial present value as the members form of benefit, computed using the
applicable interest rate defined in.
R.S.
11:1171 and the applicable mortality table
defined, divided by 1.05.
ii. Annuity Starting Date in Plan Years
Beginning in 2004 or 2005. If the annuity starting date of the members form of
benefit is in a plan year beginning in 2004 or 2005, the actuarially equivalent
straight life annuity is equal to the annual amount of the straight life
annuity commencing at the same annuity starting date that has the same
actuarial present value as the members form of benefit, computed using
whichever of the following produces the greater annual amount:
(a) . the interest rate specified in
R.S.
11:1171 and the mortality table (or other
tabular factor) specified in
R.S.
11:1171 for adjusting benefits in the same
form; and
(b) . a 5.5 percent
interest rate assumption and the applicable mortality table. If the annuity
starting date of the members benefit is on or after the first day of the first
plan year beginning in 2004 and before December 31, 2004, the application of
this §401.F.1.c shall not cause the amount payable under the members form of
benefit to be less than the benefit calculated under the plan, taking into
account the limitations of this Chapter, except that the actuarially equivalent
straight life annuity is equal to the annual amount of the straight life
annuity commencing at the same annuity starting date that has the same
actuarial present value as the members form of benefit, computed using
whichever of the following produces the greatest annual amount:
(i) . the interest rate specified in
R.S.
11:1171 and the mortality table (or other
tabular factor) specified in
R.S.
11:1171 for adjusting benefits in the same
form;
(ii) . the applicable
interest rate defined in
R.S.
11:1171 and the applicable mortality table;
and
(iii) . the applicable interest
rate defined in
R.S.
11:1171 (as in effect on the last day of the
last plan year beginning before January 1, 2004, under provisions of the plan
then adopted and in effect) and the applicable mortality table.
Applicable Mortality Table-the applicable
mortality table within the meaning of section 417(e)(3)(B) of the
Internal Revenue Code.
Defined Benefit Compensation Limitation-100
percent of a members high three-year average compensation, payable in the form
of a straight life annuity. In the case of a member who is rehired after a
severance from employment, the defined benefit compensation limitation is the
greater of 100 percent of the members high three-year average compensation, as
determined prior to the severance from employment or 100 percent of the members
high three-year average compensation, as determined after the severance from
employment under §401 G
Defined Benefit Dollar Limitation-effective
for limitation years ending after December 31, 2001, the defined benefit dollar
limitation is $160,000, automatically adjusted under section 415(d) of the
Internal Revenue Code, effective January 1 of each year, as
published in the Internal Revenue Bulletin, and payable in the
form of a straight life annuity. The new limitation shall apply to limitation
years ending with or within the calendar year of the date of the adjustment,
but a members benefits shall not reflect the adjusted limit prior to January 1
of that calendar year.
Employer - for purposes of this chapter,
employer shall mean the employer that adopts this plan, and all members of a
controlled group of corporations, as defined in section 414(b) of the
Internal Revenue Code, as modified by section 415(h), all
commonly controlled trades or businesses [as defined in section 414(c), as
modified, except in the case of a brother-sister group of trades or businesses
under common control, by section 415(h)], or affiliated service groups [as
defined in section 414(m)] of which the adopting employer is a part, and any
other entity required to be aggregated with the employer pursuant to section
414(o) of the Internal Revenue Code.
Formerly Affiliated Plan of the Employer-a
plan that, immediately prior to the cessation of affiliation, was actually
maintained by the employer and, immediately after the cessation of affiliation
is not actually maintained by the employer. For this purpose, cessation of
affiliation means the event that causes an entity to no longer be considered
the employer, such as the sale of a member controlled group of corporations, as
defined in section 414(b) of the Internal Revenue Code, as
modified by section 415(h), to an unrelated corporation, or that causes a plan
to not actually be maintained by the employer, such as transfer of plan
sponsorship outside a controlled group.
High Three-Year Average Compensation - the
average compensation for the three consecutive years of service (or, if the
member has less than three consecutive years of service, the members longest
consecutive period of service, including fractions of years, but not less than
one year) with the employer that produces the highest average. A year of
service with the employer is the 12 consecutive month period defined in
R.S.
11:1131. In the case of a member who is
rehired by the employer after a severance from employment, the members high
three-year average compensation shall be calculated by excluding all years for
which the member performs no services for and receives no compensation from the
employer (the break period) and by treating the years immediately preceding and
following the break period as consecutive. A members compensation for a year of
service shall not include compensation in excess of the limitation under
section 401(a)(17) of the Internal Revenue Code that is in
effect for the calendar year in which such year of service begins.
Limitation Year - a fiscal year, from July 1
to June 31. All qualified plans maintained by the employer must use the same
limitation year. If the limitation year is amended to a different
12-consecutive month period, the new limitation year must begin on a date
within the limitation year in which the amendment is made.
Maximum Permissible Benefit - the lesser of
the defined benefit dollar limitation or the defined benefit compensation
limitation (both adjusted where required, as provided below).
a. Adjustment for Less than 10 Years of
Participation or Service. If the member has less than 10 years of participation
in the plan, the defined benefit dollar limitation shall be multiplied by a
fraction:
i. the numerator of which is the
number of years (or part thereof, but not less than one year) of participation
in the plan; and
ii. the
denominator of which is 10. In the case of a member who has less than 10 years
of service with the employer, the defined benefit compensation limitation shall
be multiplied by a fraction:
(a) . the
numerator of which is the number of years (or part thereof, but not less than
one year) of Service with the employer; and
(b) . the denominator of which is 10.
b.
Adjustment of Defined Benefit Dollar Limitation for Benefit Commencement before
Age 62 or after Age 65. Effective for benefits commencing in limitation years
ending after December 31, 2001, the defined benefit dollar limitation shall be
adjusted if the annuity starting date of the members benefit is before age 62
or after age 65. If the annuity starting date is before age 62, the defined
benefit dollar limitation shall be adjusted under Clause b.i of this Paragraph,
as modified by Clause b.iii of this Paragraph. If the annuity starting date is
after age 65, the defined benefit dollar limitation shall be adjusted under
Clause b.ii of this Paragraph, as modified by Clause b.iii of this Paragraph.
i. Adjustment of Defined Benefit Dollar
Limitation for Benefit Commencement before Age 62
(a) . Limitation Years Beginning before July
1, 2007. If the annuity starting date for the members benefit is prior to age
62 and occurs in a limitation year beginning before July 1, 2007, the defined
benefit dollar limitation for the members annuity starting date is the annual
amount of a benefit payable in the form of a straight life annuity commencing
at the members annuity starting date that is the actuarial equivalent of the
defined benefit dollar limitation (adjusted under §401.F 10.a. for years of
participation less than 10, if required) with actuarial equivalence computed
using whichever of the following produces the smaller annual amount:
(i) . the interest rate specified in
R.S.
11:1171 and the mortality table (or other
tabular factor) specified in
R.S.
11:1171; or
(ii) . a 5 percent interest rate assumption
and the applicable mortality table as defined in
R.S.
11:1171.
(b) . Limitation Years Beginning on or After
July 1, 2007
(i) . Plan Does Not Have
Immediately Commencing Straight Life Annuity Payable at Both Age 62 and the Age
of Benefit Commencement. If the annuity starting date for the members benefit
is prior to age 62 and occurs in a limitation year beginning on or after July
1, 2007, and the plan does not have an immediately commencing straight life
annuity payable at both age 62 and the age of benefit commencement, the defined
benefit dollar limitation for the members annuity starting date is the annual
amount of a benefit payable in the form of a straight life annuity commencing
at the members annuity starting date that is the actuarial equivalent of the
defined benefit dollar limitation (adjusted under Subparagraph a of this
Paragraph for years of participation less than 10, if required) with actuarial
equivalence computed using a 5 percent interest rate assumption and the
applicable mortality table for the annuity starting date as defined in
R.S.
11:1171 (and expressing the members age based
on completed calendar months as of the annuity starting date).
(ii) . Plan Has Immediately Commencing
Straight Life Annuity Payable at Both Age 62 and the Age of Benefit
Commencement. If the annuity starting date for the members benefit is prior to
age 62 and occurs in a limitation year beginning on or after July 1, 2007, and
the plan has an immediately commencing straight life annuity payable at both
age 62 and the age of benefit commencement, the defined benefit dollar
limitation for the members annuity starting date is the lesser of the
limitation determined under Division b.i.(b).(i) of this Paragraph and the
defined benefit dollar limitation (adjusted under Subparagraph a of this
Paragraph for years of participation less than 10, if required) multiplied by
the ratio of the annual amount of the immediately commencing straight life
annuity under the plan at the members annuity starting date to the annual
amount of the immediately commencing straight life annuity under the plan at
age 62, both determined without applying the limitations of this
article.
ii.
Adjustment of Defined Benefit Dollar Limitation for Benefit Commencement after
Age 65
(a) . Limitation Years Beginning
Before July 1, 2007. If the annuity starting date for the members benefit is
after age 65 and occurs in a limitation year beginning before July 1, 2007, the
defined benefit dollar limitation for the members annuity starting date is the
annual amount of a benefit payable in the form of a straight life annuity
commencing at the members annuity starting date that is the actuarial
equivalent of the defined benefit dollar limitation (adjusted under
Subparagraph a of this Paragraph for years of participation less than 10, if
required) with actuarial equivalence computed using whichever of the following
produces the smaller annual amount:
(i) . the
interest rate specified in
R.S.
11:1171 and the mortality table (or other
tabular factor) specified in
R.S.
11:1171; or
(ii) . a 5-percent interest rate assumption
and the applicable mortality table as defined in
R.S.
11:1171.
(b) . Limitation Years Beginning Before July
1, 2007
(i) . Plan Does Not Have Immediately
Commencing Straight Life Annuity Payable at Both Age 65 and the Age of Benefit
Commencement. If the annuity starting date for the members benefit is after age
65 and occurs in a limitation year beginning on or after July 1, 2007, and the
plan does not have an immediately commencing straight life annuity payable at
both age 65 and the age of benefit commencement, the defined benefit dollar
limitation at the members annuity starting date is the annual amount of a
benefit payable in the form of a straight life annuity commencing at the
members annuity starting date that is the actuarial equivalent of the defined
benefit dollar limitation (adjusted under Subparagraph a of this Paragraph for
years of participation less than 10, if required), with actuarial equivalence
computed using a 5 percent interest rate assumption and the applicable
mortality table for that annuity starting date as defined in
R.S.
11:1171 (and expressing the members age based
on completed calendar months as of the annuity starting date).
(ii) . Plan Has Immediately Commencing
Straight Life Annuity Payable at Both Age 65 and the Age of Benefit
Commencement. If the annuity starting date for the members benefit is after age
65 and occurs in a limitation year beginning on or after July 1, 2007, and the
plan has an immediately commencing straight life annuity payable at both age 65
and the age of benefit commencement, the defined benefit dollar limitation at
the members annuity starting date is the lesser of the limitation determined
under §401.F 10.b.ii.(b).(i). and the defined benefit dollar limitation
(adjusted under §401.F 10.a. for years of participation less than 10, if
required) multiplied by the ratio of the annual amount of the adjusted
immediately commencing straight life annuity under the plan at the members
annuity starting date to the annual amount of the adjusted immediately
commencing straight life annuity under the plan at age 65, both determined
without applying the limitations of this article. For this purpose, the
adjusted immediately commencing straight life annuity under the plan at the
members annuity starting date is the annual amount of such annuity payable to
the member, computed disregarding the members accruals after age 65 but
including actuarial adjustments even if those actuarial adjustments are used to
offset accruals; and the adjusted immediately commencing straight life annuity
under the plan at age 65 is the annual amount of such annuity that would be
payable under the plan to a hypothetical member who is age 65 and has the same
accrued benefit as the member.
iii. Notwithstanding the other requirements
of this Subparagraph F.10.b., no adjustment shall be made to the defined
benefit dollar limitation to reflect the probability of a members death between
the annuity starting date and age 62, or between age 65 and the annuity
starting date, as applicable, if benefits are not forfeited upon the death of
the member prior to the annuity starting date. To the extent benefits are
forfeited upon death before the annuity starting date, such an adjustment shall
be made. For this purpose, no forfeiture shall be treated as occurring upon the
members death if the plan does not charge members for providing a qualified
preretirement survivor annuity, as defined in section 417(c) of the
Internal Revenue Code, upon the members death.
c. Minimum Benefit Permitted.
Notwithstanding anything else in this section to the contrary, the benefit
otherwise accrued or payable to a member under this plan shall be deemed not to
exceed the maximum permissible benefit if:
i.
the retirement benefits payable for a limitation year under any form of benefit
with respect to such member under this plan and under all other defined benefit
plans (without regard to whether a plan has been terminated) ever maintained by
the employer do not exceed $10,000 multiplied by a fraction:
(a) . the numerator of which is the members
number of years (or part thereof, but not less than one year) of service (not
to exceed 10) with the employer; and
(b) . the denominator of which is 10;
and
ii. the employer (or
a predecessor employer) has not at any time maintained a defined contribution
plan in which the member participated (for this purpose, mandatory employee
contributions under a defined benefit plan, individual medical accounts under
section 401(h), and accounts for postretirement medical benefits established
under section 419A(d)(1) are not considered a separate defined contribution
plan).
Predecessor Employer - if the employer
maintains a plan that provides a benefit which the member accrued while
performing services for a former employer, the former employer is a predecessor
employer with respect to the member in the plan. A former entity that antedates
the employer is also a predecessor employer with respect to a member if, under
the facts and circumstances, the employer constitutes a continuation of all or
a portion of the trade or business of the former entity.
Severance from Employment - an employee has
a severance from employment when the employee ceases to be an employee of the
employer maintaining the plan. An employee does not have a severance from
employment if, in connection with a change of employment, the employees new
employer maintains the plan with respect to the employee.
Year of Participation - the member shall be
credited with a year of participation (computed to fractional parts of a year)
for each accrual computation period for which the following conditions are
met:
a. the member is credited with at
least the number of hours of service (or period of service if the elapsed time
method is used) for benefit accrual purposes, required under the terms of the
plan in order to accrue a benefit for the accrual computation period;
and
b. the member is included as a
member under the eligibility provisions of the plan for at least one day of the
accrual computation period. If these two conditions are met, the portion of a
year of participation credited to the member shall equal the amount of benefit
accrual service credited to the member for such accrual computation period. A
member who is permanently and totally disabled within the meaning of section
415(c)(3)(C)(i) of the Internal Revenue Code for an accrual
computation period shall receive a year of participation with respect to that
period. In addition, for a member to receive a year of participation (or part
thereof) for an accrual computation period, the plan must be established no
later than the last day of such accrual computation period. In no event shall
more than one year of participation be credited for any 12-month
period.
G. Other
Rules
1. Benefits under Terminated Plans. If
a defined benefit plan maintained by the employer has terminated with
sufficient assets for the payment of benefit liabilities of all plan members
and a member in the plan has not yet commenced benefits under the plan, the
benefits provided pursuant to the annuities purchased to provide the members
benefits under the terminated plan at each possible annuity starting date shall
be taken into account in applying the limitations of this article. If there are
not sufficient assets for the payment of all members benefit liabilities, the
benefits taken into account shall be the benefits that are actually provided to
the member under the terminated plan.
2. Benefits Transferred from the Plan. If a
members benefits under a defined benefit plan maintained by the employer are
transferred to another defined benefit plan maintained by the employer and the
transfer is not a transfer of distributable benefits pursuant section
1.411(d)-4, Q and A-3(c), of the income tax regulations, the transferred
benefits are not treated as being provided under the transferor plan (but are
taken into account as benefits provided under the transferee plan). If a
members benefits under a defined benefit plan maintained by the employer are
transferred to another defined benefit plan that is not maintained by the
employer and the transfer is not a transfer of distributable benefits pursuant
section 1.411(d)-4, Q and A-3(c), of the income tax regulations, the
transferred benefits are treated by the employers plan as if such benefits were
provided under annuities purchased to provide benefits under a plan maintained
by the employer that terminated immediately prior to the transfer with
sufficient assets to pay all members benefit liabilities under the plan. If a
members benefits under a defined benefit plan maintained by the employer are
transferred to another defined benefit plan in a transfer of distributable
benefits pursuant section 1.411(d)-4, Q and A-3(c), of the income tax
regulations, the amount transferred is treated as a benefit paid from the
transferor plan.
3. Formerly
Affiliated Plans of the Employer. A formerly affiliated plan of an employer
shall be treated as a plan maintained by the employer, but the formerly
affiliated plan shall be treated as if it had terminated immediately prior to
the cessation of affiliation with sufficient assets to pay members benefit
liabilities under the plan and had purchased annuities to provide
benefits.
4. Plans of a Predecessor
Employer. If the employer maintains a defined benefit plan that provides
benefits accrued by a member while performing services for a predecessor
employer, the members benefits under a plan maintained by the predecessor
employer shall be treated as provided under a plan maintained by the employer.
However, for this purpose, the plan of the predecessor employer shall be
treated as if it had terminated immediately prior to the event giving rise to
the predecessor employer relationship with sufficient assets to pay members
benefit liabilities under the plan, and had purchased annuities to provide
benefits; the employer and the predecessor employer shall be treated as if they
were a single employer immediately prior to such event and as unrelated
employers immediately after the event; and if the event giving rise to the
predecessor relationship is a benefit transfer, the transferred benefits shall
be excluded in determining the benefits provide under the plan of the
predecessor employer.
5. Special
Rules. The limitations of this chapter shall be determined and applied taking
into account the rules in section 1.415(f)-1(d), (e) and (h) of the income tax
regulations.
AUTHORITY NOTE:
Promulgated in accordance with
R.S.
11:1165.1.
