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Notes

29 C.F.R. §§ 4044.71–4044.75

5 sections in range

§4044.71. Valuation of annuity benefits.

29 C.F.R. § 4044.71

The value of a benefit which is to be paid as an annuity is the cost of purchasing the annuity on the date of distribution from an insurer.
Notes, amendments, and revision history

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

Authority

Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.

Source

Source: 61 FR 34059, July 1, 1996, unless otherwise noted.

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

§4044.72. Form of annuity to be valued.

29 C.F.R. § 4044.72

(a)
When both the participant and beneficiary are alive on the date of distribution, the form of annuity to be valued is—
(1)
For a participant or beneficiary already receiving a monthly benefit, that form which is being received, or
(2)
For a participant or beneficiary not receiving a monthly benefit, the normal annuity form payable under the plan or the optional form for which the participant has made a valid election.
(b)
When the participant dies after the date of plan termination but before the date of distribution, the form of annuity to be valued is determined under paragraph (b)(1) or (b)(2) of this section:
(1)
For a participant who was entitled to a deferred annuity—
(i)
If the form was a single or joint life annuity, no benefit shall be valued; or
(ii)
If the participant had made a valid election of a lump sum benefit before he or she died, the form to be valued is the lump sum.
(2)
For a participant who was eligible for immediate retirement, and for a participant who was in pay status at the date of termination—
(i)
If the form was a single life annuity, no benefit shall be valued;
(ii)
If the form was an annuity for a period certain and life thereafter, the form to be valued is an annuity for the certain period;
(iii)
If the form was a joint and survivor annuity, the form to be valued is a single life annuity payable to the beneficiary, unless the beneficiary has also died, in which case no benefit shall be valued;
(iv)
If the form was an annuity for a period certain and joint and survivor thereafter, the form to be valued is an annuity for the certain period and the life of the beneficiary thereafter, unless the beneficiary has also died, in which case the form to be valued is an annuity for the certain period;
(v)
If the form was a cash refund annuity, the form to be valued is the remaining lump sum death benefit; or
(vi)
If the participant had elected a lump sum benefit before he or she died, the form to be valued is the lump sum.
(c)
When the participant is still living and the named beneficiary or spouse dies after the date of termination but before the date of distribution, the form of annuity to be valued is determined under paragraph (c)(1) or (c)(2) of this section:
(1)
For a participant entitled to a deferred annuity—
(i)
If the form was a joint and survivor annuity, the form to be valued is a single life annuity payable to the participant; or
(ii)
If the form was an annuity for a period certain and joint and survivor thereafter, the form to be valued is an annuity for the certain period and the life of the participant thereafter.
(2)
For a participant eligible for immediate retirement and for a participant in pay status at the date of termination—
(i)
If the form was a joint and survivor annuity, the form to be valued is a single life annuity payable to the participant; or
(ii)
If the form was an annuity for a period certain and joint survivor thereafter annuity, the form to be valued is an annuity for the certain period and for the life of the participant thereafter.
Notes, amendments, and revision history

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

Authority

Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.

Source

Source: 61 FR 34059, July 1, 1996, unless otherwise noted.

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

§4044.73. Lump sums and other alternative forms of distribution in lieu of annuities.

29 C.F.R. § 4044.73

(a)
Valuation.
(1)
The value of the lump sum or other alternative form of distribution is the present value of the normal form of benefit provided by the plan payable at normal retirement age, determined as of the date of distribution using reasonable actuarial assumptions as to interest and mortality.
(2)
If the participant dies before the date of distribution, but had elected a lump sum benefit, the present value shall be determined as if the participant were alive on the date of distribution.
(b)
Actuarial assumptions. The plan administrator shall specify the actuarial assumptions used to determine the value calculated under paragraph (a) of this section when the plan administrator submits the benefit valuation data to the PBGC. The same actuarial assumptions shall be used for all such calculations. The PBGC reserves the right to review the actuarial assumptions used and to re-value the benefits determined by the plan administrator if the actuarial assumptions are found to be unreasonable.
Notes, amendments, and revision history

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

Authority

Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.

Source

Source: 61 FR 34059, July 1, 1996, unless otherwise noted.

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

§4044.74. Withdrawal of employee contributions.

29 C.F.R. § 4044.74

(a)
If a participant has not started to receive monthly benefit payments on the date of distribution, the value of the lump sum which returns mandatory employee contributions is equal to the total amount of contributions made by the participant, plus interest that is payable to the participant under the terms of the plan, plus interest on that total amount from the date of termination to the date of distribution. The rate of interest credited on employee contributions up to the date of termination shall be the greater of the interest rate provided under the terms of the plan or the interest rate required under section 204(c) of ERISA or section 411(c) of the IRC.
(b)
If a participant has started to receive monthly benefit payments on the date of distribution, part of which are attributable to his or her contributions, the value of the lump sum which returns employee contributions is equal to the excess of the amount described in paragraph (b)(1) of this section over the amount computed in paragraph (b)(2) of this section.
(1)
The amount of accumulated mandatory employee contributions remaining in the plan as of the date of termination plus interest from the date of termination to the date of distribution.
(2)
The excess of benefit payments made from the plan between date of plan termination and the date of distribution, over the amount of payments that would have been made if the employee contributions had been paid as a lump sum on the date of plan termination, with interest accumulated on the excess from the date of payment to the date of distribution.
(c)
Interest assumptions. The interest rate used under this section to credit interest between the date of termination to the date of distribution shall be a reasonable rate and shall be the same for both paragraphs (a) and (b).
Notes, amendments, and revision history

Authority

Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.

Source

Source: 61 FR 34059, July 1, 1996, unless otherwise noted.

§4044.75. Other lump sum benefits.

29 C.F.R. § 4044.75

The value of a lump sum benefit which is not covered under § 4044.73 or § 4044.74 is equal to—
(a)
The value under the irrevocable commitment, if an insurer provides the benefit; or
(b)
The present value of the benefit as of the date of distribution, determined using reasonable actuarial assumptions, if the benefit is to be distributed other than by the purchase of the benefit from an insurer. The PBGC reserves the right to review the actuarial assumptions as to reasonableness and re-value the benefit if the actuarial assumptions are unreasonable.
Notes, amendments, and revision history

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]

Authority

Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.

Source

Source: 61 FR 34059, July 1, 1996, unless otherwise noted.

Amendments

[61 FR 34059, July 1, 1996, as amended at 76 FR 34606, June 14, 2011]