Cash Balance Plan Answer Book, Second Edition

Cash Balance Plan Answer Book is the only resource that provides reliable answers to over 500 cash balance plan questions. Logically organized in the popular Q&A format, the Cash Balance Plan Answer Book is a user-friendly guide that explains the fundamentals of cash balance plans and how and when to use them. This unique resource provides support as you consider - and implement - cash balance plans.

Cash Balance Plan Answer Book enables you to:

• Determine whether cash balance plans are right for your company or your clients
• Explain exactly how cash balance plans work
• Clarify how cash balance plans can be used with traditional retirement plans or 401(k) plans for the benefit of both the plan sponsor and participants
• Advise clients and executives on the pros and cons of cash balance plans
• Guide your company or clients through the effective implementation of cash balance plans
• Answer any cash balance plan question that comes up along the way

Here is just a sampling of the over-500 key questions that are answered in this one-of-a-kind resource:

• How prevalent are cash balance plans?
• Are there advantages of a cash balance plan over a defined contribution plan?
• What types of business considerations would cause an employer to prefer a cash balance plan over a traditional defined benefit pension plan?
• How have traditional plans been converted to cash balance plans?
• What rules does the PPA create for cash balance plans?
• How does the PPA change the age discrimination rules for cash balance plans?
• How are qualified domestic relations orders (QDROs) administered under a cash balance plan?
• What special considerations apply to cash balance plans for accrual rule purposes?
• Are there special considerations when terminating a cash balance plan?
• What special issues may apply to plans converted to cash balance before the PPA?

You'll also receive:

• Planning tips - to get you on the right track from the start
• Examples - to clarify complex issues
• Cautions - to help you avoid pitfalls
• Explanations of the law - to make sure you understand all the rules and regulations

Cash Balance Plan Answer Book, Second Edition has been revised in order to keep subscribers current with the regulations and significant changes affecting cash balance and other hybrid defined benefit plans. Highlights include:

• A detailed summary and analysis of the final and proposed hybrid plan regulations issued by the Treasury and Internal Revenue Service (IRS) in October 2010
• Court rulings on age discrimination, including appellate decisions, which continue to overwhelmingly hold that the cash balance plan design is not inherently age discriminatory
• Treasury and IRS guidance on interest crediting rates, anti-cutback relief, and delay of certain amendment adoption dates
• The latest IRS concerns about pension equity plans
• Details on risk mitigation and management strategies applied to cash balance plans
• New developments regarding whipsaw, including new requirements that must be met for a plan to be able to eliminate whipsaw under the 2010 proposed hybrid plan regulations

• Introduction
  • Cash Balance and Other Hybrid Pension Plans Defined
  • The Legal Framework of Cash Balance Plans
  • A Brief History of Cash Balance Plans
  • Whipsaw
  • Wearaway
  • Age Discrimination
• Cash Balance Plan Design
  • Basic Design
  • Reasons for Offering Cash Balance Plans
  • Designing Pay (or Service) Credits
  • Defining Interest Credits
  • Compensation Defined
  • Eligibility for Participation
  • Vesting Requirements
  • Benefits at Retirement
  • Benefits Available
  • Benefit Limits
  • Ancillary Benefits
  • Contributory Plans
  • Pension Equity Plans
  • Impact of the Pension Protection Act of 2006 on Hybrid Plan Design
  • Plan Mergers
• Administration
  • Parties Involved in Plan Administration and Oversight
  • Administrative Tasks
  • Service Providers
  • Paying for Administrative Fees
  • Some Other Administrative Considerations for Cash Balance Plans
• Converting an Existing Defined Benefit Plan to Cash Balance
  • Plan Conversion Approaches
  • Opening Account Balance Conversions
  • Impact on Plan Participants
  • Transition Alternatives
  • Other Considerations for Conversions
• Age Discrimination
  • General Standard for Defined Benefit Plans
  • Age Discrimination Controversy over Cash Balance Plan Design
  • Safe Harbor Age Discrimination Standard
  • Age Discrimination Rules Specific to Hybrid Defined Benefit Plans
  • Other Age Discrimination Concerns
• Communication, Reporting, and Disclosure
  • General Communication
  • Communicating Plan Changes
  • Participant Statements
  • Summary Plan Descriptions
  • Participant Communication about Plan Funding and Funded Status
  • Communication at Distribution
  • Other Reporting and Disclosure
• Plan Costs
  • General Plan Cost Information
  • Determining Plan Funding Costs
  • Determining Accounting Costs for the Plan
  • Other Plan Cost Considerations
• Eligibility and Vesting
  • Minimum Participation and Vesting Requirements
  • Determining Service
  • Break-in-Service Rules
  • Changing the Vesting Schedule
• Distributions
  • Forms of Payment
  • Required Minimum Distributions
  • Taxation and Rollovers
• Accrual Rules
  • Basic Rules
  • Cash Balance Considerations
• Coverage and Nondiscrimination Testing
  • Controlled Group
  • Employees and Highly Compensated Employees
  • Plan Coverage Requirements
  • Defining Plans for Purposes of Testing
  • Benefits Tests and Safe Harbors
  • Other Nondiscrimination Considerations
  • Separate Line of Business Rules
• Top Heavy Testing
  • Basic Top Heavy Requirements
  • Determining Key Employees
  • Applying Top Heavy Requirements
• Investment of Plan Assets
  • Basic Rules for Plan Investments
  • Relationship between Asset and Liabilities
  • Choosing Investments to Manage Risk
• Plan Termination
  • Choosing to Terminate a Cash Balance Plan
  • PBGC Requirements
  • Notifying Plan Participants
  • Other Considerations
• Qualified Domestic Relations Orders
  • What is a QDRO
  • Determining the QDRO Benefit
  • Considerations During Plan Conversions
• Determination Letters
  • Reasons for Requesting a Determination Letter
  • Timing and Filing Considerations
  • Special Situations
  • Notification Requirements
• Index
• Table of Cases
• List of Code Sections and Regulations