Fractional accrual plans.

(C) Fractional accrual plans. In the case of a fractional accrual plan described in 1.401(a)(4)-3(b)(4), the benefit formula must provide for the nondisparate percentage with respect to years of service after the employee would reach the cumulative permitted disparity limit applicable to the employee under 1.401(l)-5(c) as modified by this paragraph (c)(2)(vi)(C). Solely for purposes of this paragraph (c)(2)(vi)(C), the employee's annual disparity fractions (and thus the year in which the employee would reach the cumulative permitted disparity limit) are determined using the disparity provided under the benefit formula (rather than the special rule for fractional accrual plans in 1.401(l)-5(b)(8)(v)).

Source

26 CFR § 1.401(l)-3


Scoping language

None
Is this correct? or