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Related to Accrued benefit: Accrued Benefit Cost Method
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A Supreme Court case applied ERISA to working business owners when the plan covered other employees; another prohibited adding suspension conditions to past accrued benefits.
2004 2003 $ $ Accrued benefit obligation, beginning of year 1,858 1,826 Current service cost 67 70 Interest cost 111 114 Benefits paid (135) (408) Actuarial loss - 256 Accrued benefit obligation, end of year 1,901 1,858 Fair value of plan assets, beginning of year 1,214 1,292 Actual return on plan assets 105 150 Employer contributions 253 180 Benefits paid (135) (408) Fair value of plan assets, end of year 1,437 1,214 Plan assets consist of: % % Asset Category Equity securities 67.
In situations where the employer-provided portion of the accrued benefit (before addition of the benefit derived from the purchase of service credits) is greater than the age-reduced dollar limit, the 415(b) test would not be met, since 415(n) does not exempt plans from testing the employer portion of the accrued benefit against the age-reduced dollar limit.
The ruling provided that, due to the different objectives underlying the federal income tax withholding rules and FICA withholding rules, the vested accrued benefit under a 402(b) trust is subject to income tax withholding on the last day of the tax year of the trust.
Furthermore, under current GASB standards, the calculation of the employer's unfunded accrued benefit obligation is reduced by anticipated earnings on amounts placed in trust.
The PPA establishes new funding requirements and limits benefit accruals for certain plans deemed "at risk," which means the accrued benefits under the plan are less than 80 percent funded based on the prior year's assets.
A plan will be at risk if the accrued benefits under the plan are less than 80 percent funded based on the prior year's assets.
Thus having an accurate number for the accrued benefit expense and tax deduction is not possible without significant allocations that, even if affected, would appear to be of little value.
In a cash-balance plan conversion, the employer determines an employee's accrued benefit under the old plan.
The Boyett ruling equates the plan's accrued benefit with the amount of retirement benefit that is earned on the cutoff date.
calculation of past service liabilities and future service costs on three bases: Accrued Benefit Obligation, Vested Benefit