eligible combined plan

(A)The term “eligible combined plan” means a plan— (i)which is maintained by an employer which, at the time the plan is established, is a small employer, (ii)which consists of a defined benefit plan and an applicable defined contribution plan, (iii)the assets of which are held in a single trust forming part of the plan and are clearly identified and allocated to the defined benefit plan and the applicable defined contribution plan to the extent necessary for the separate application of this title under paragraph (1), and (iv)with respect to which the benefit, contribution, vesting, and nondiscrimination requirements of subparagraphs (B), (C), (D), (E), and (F) are met. (B) (i)The benefit requirements of this subparagraph are met with respect to the defined benefit plan forming part of the eligible combined plan if the accrued benefit of each participant derived from employer contributions, when expressed as an annual retirement benefit, is not less than the applicable percentage of the participant’s final average pay. For purposes of this clause, final average pay shall be determined using the period of consecutive years (not exceeding 5) during which the participant had the greatest aggregate compensation from the employer. (ii)For purposes of clause (i), the applicable percentage is the lesser of— (I)1 percent multiplied by the number of years of service with the employer, or (II)20 percent. (iii)If the defined benefit plan under clause (i) is an applicable defined benefit plan as defined inwhich meets the interest credit requirements of section 411(b)(5)(B)(i), the plan shall be treated as meeting the requirements of clause (i) with respect to any plan year if each participant receives a pay credit for the year which is not less than the percentage of compensation determined in accordance with the following table: (iv)For purposes of this subparagraph, years of service shall be determined under the rules of paragraphs (4), (5), and (6) of section 411(a), except that the plan may not disregard any year of service because of a participant making, or failing to make, any elective deferral with respect to the qualified cash or deferred arrangement to which subparagraph (C) applies. (C) (i)The contribution requirements of this subparagraph with respect to any applicable defined contribution plan forming part of an eligible combined plan are met if— (I)the qualified cash or deferred arrangement included in such plan constitutes an automatic contribution arrangement, and (II)the employer is required to make matching contributions on behalf of each employee eligible to participate in the arrangement in an amount equal to 50 percent of the elective contributions of the employee to the extent such elective contributions do not exceed 4 percent of compensation. (ii)An applicable defined contribution plan shall not be treated as failing to meet the requirements of clause (i) because the employer makes nonelective contributions under the plan but such contributions shall not be taken into account in determining whether the requirements of clause (i)(II) are met. (D)The vesting requirements of this subparagraph are met if— (i)in the case of a defined benefit plan forming part of an eligible combined plan an employee who has completed at least 3 years of service has a nonforfeitable right to 100 percent of the employee’s accrued benefit under the plan derived from employer contributions, and (ii)in the case of an applicable defined contribution plan forming part of eligible combined plan— (I)an employee has a nonforfeitable right to any matching contribution made under the qualified cash or deferred arrangement included in such plan by an employer with respect to any elective contribution, including matching contributions in excess of the contributions required under subparagraph (C)(i)(II), and (II)an employee who has completed at least 3 years of service has a nonforfeitable right to 100 percent of the employee’s accrued benefit derived under the arrangement from nonelective contributions of the employer. (E)In the case of a defined benefit plan or applicable defined contribution plan forming part of an eligible combined plan, the requirements of this subparagraph are met if all contributions and benefits under each such plan, and all rights and features under each such plan, must be provided uniformly to all participants. (F) (i)The requirements of this subparagraph are met if the requirements of clauses (ii) and (iii) are met. (ii)The requirements of this clause are met if— (I)the requirements of subparagraphs (B) and (C) are met without regard to section 401(l), and (II)the requirements ofare met with respect to both the applicable defined contribution plan and defined benefit plan forming part of an eligible combined plan without regard to section 401(l). (iii)The requirements of this clause are met if the applicable defined contribution plan and defined benefit plan forming part of an eligible combined plan meet the requirements ofwithout being combined with any other plan.

Source

26 USC § 414(x)(2)(A)


Scoping language

None: Default is title Scope
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