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Cash Balance Plan Answer Book, Fourth Edition by Paul Rangecroft , Daniel Schwallie , Barbara Hogg , Eric Keener Cash Balance Plan Answer Book, Fourth Edition by Paul Rangecroft , Daniel Schwallie , Barbara Hogg , Eric Keener

Cash Balance Plan Answer Book, Fourth Edition

By Daniel Schwallie, Barbara Hogg, Paul Rangecroft, Eric Keener
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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

The Fourth Edition of Cash Balance Plan Answer Book has been updated to include:

  • Expanded discussion of pension equity plans
  • Updates for the 2014 hybrid plan regulations
  • Revised treatment of cash balance and pension equity plans under the final hybrid plan regulations with respect to whipsaw and age discrimination
  • Discussion of new pre-approved cash balance plan document program of Revenue Procedure 2015-36
  • Overview of 2015 proposed DOL fiduciary rules
  • And much more!

Note: Online subscriptions are for three-month periods.

Previous Edition: Cash Balance Plan Answer Book, Third Edition, SKU: 10045317-7777

Last Updated 08/20/2020
Update Frequency Annually
Product Line Wolters Kluwer Legal & Regulatory U.S.
SKU 10071577-7777
Publish Frequency Annually
Product Line Wolters Kluwer Legal & Regulatory U.S.
SKU 000000000010048422
Table of Contents

Chapter 1 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


Chapter 2  Cash Balance Plan Design

  • Basic Design
  • Reasons for Offering Cash Balance Plans
  • Designing Principal 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


Chapter 3 Administration

  • Parties Involved in Plan Administration and Oversight
  • Administrative Tasks
  • Service Providers
  • Paying for Administrative Fees
  • Other Administrative Considerations for Cash Balance Plans


Chapter 4 Conversions

  • Plan Conversion Approaches
  • Opening Account Balance Conversions
  • Impact on Plan Participants
  • Transition Alternatives
  • Other Considerations for Conversions


Chapter 5 Age Discrimination Rules for Cash Balance Plans

  • General Standards 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


Chapter 6 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


Chapter 7 Plan Costs

  • General Plan Cost Information
  • Plan Funding Information
  • Plan Accounting Information
  • Other Plan Cost Information


Chapter 8 Eligibility and Vesting

  • Minimum Participation and Vesting Requirements
  • Determining Service
  • Break in Service Rules
  • Changing the Vesting Schedule


Chapter 9 Distributions

  • Forms of Payment
  • Required Distributions
  • Taxation


Chapter 10 Accrual Rules

  • Basic Rules
  • Cash Balance Considerations


Chapter 11 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


Chapter 12 Top-Heavy Testing

  • Basic Top-Heavy Requirements
  • Determining Key Employees
  • Applying Top-Heavy Requirements

Chapter 13 Investment of Plan Assets

  • Basic Rules for Plan Investments
  • Relationship Between Assets and Liabilities
  • Choosing Investments to Manage Risk


Chapter 14 Plan Termination

  • Choosing to Terminate a Cash Balance Plan
  • PBGC Requirements
  • Notifying Plan Participants
  • Other Considerations


Chapter 15 Qualified Domestic Relations Orders (QDROs)

  • What Is a QDRO?
  • Determining the QDRO Benefit
  • Considerations During Plan Conversions
  • Regulatory Guidance on QDROs


Chapter 16 Determination Letters

  • Effect of a Requesting a Determination Letter
  • Timing and Filing Considerations
  • Special Situations
  • Notification Requirements


Appendix A DOL Hypothetical Examples of Plan Expenses

Appendix B Model SPD Language

Appendix C Joint Implementation Guidelines

Appendix D Single Life and Uniform Lifetime Tables

Appendix E Joint Life and Last Survivor Table

Appendix F Model Language for the Annual Funding Notice

Appendix G Definitions of Section 415 Compensation

Appendix H Definitions of Code Section 414(s) Nondiscriminatory Compensation

Appendix I Department of Labor Audit Information

Appendix J Pension Equity Plan Determination Letter Processing Guidelines


  • Internal Revenue Code
  • Treasury Regulations
  • Internal Revenue Service Announcements, Notices, Memoranda, Rulings, and Procedures
  • Code of Federal Regulations
  • Department of Labor Opinions and Bulletins
  • PBGC Releases and Instructions
  • Age Discrimination in Employment Act (ADEA)
  • Pension Protection Act of 2006 (PPA)
  • Worker, Retiree and Employer Recovery Act of 2008 (WRERA)
  • Table of Cases
  • Bibliography
  • Glossary
  • Index