Defined Benefit Plans & Services
Defined Benefit Plans
Through Defined Benefit Plans, employers can provide retired employees with a benefit that is "definitely determinable." In other words, the retired employee will know in advance how much income will be available every month after retirement begins. The benefit is based on a specified formula that is usually related to an employee's length of service and/or compensation.
Defined Benefit Services
McCready and Keene manages Defined Benefit Plans with assets totaling billions of dollars. To learn more about the services we offer associated with Defined Benefit Plans click on a link below:
McCready and Keene's Consulting staff can assist you before, during and after the determination of what's best for your company. During formulation of recommendations your primary actuary will work closely with the team that has been assigned to your account. This team includes an Attorney or Paralegal who will oversee compliance, an Actuarial team, as well as a Benefits Administrator and Administrative Assistants. Utilizing their combined knowledge and experience, the team will offer recommendations that address your key concerns, as well as issues you may not have considered. To help us in determining the best plan for your company we can undertake actuarial studies that allow us to consider issues such as:
- Defined Benefit vs. Defined Contribution Plans
- Conversion to a cash balance plan
- Changes in benefit structure or formulas
- Adding or improving ancillary benefits
- Special early retirement programs
- Union negotiations.
After you make a decision about your Defined Benefit Plan, your team will be available to handle the day-to-day issues of your plan's administration, plan reporting and make you aware of new opportunities as they come up.
The McCready and Keene team that helps design your plan is the same team that will manage the administration of your plan. That administration experience means they understand the practical impact of their design, as well as the compliance and financial implications. The design team includes top compliance talent who will make sure your plan is designed to help you avoid audits by the IRS and/or the Department of Labor.
Our in-house compliance staff is capable of assisting you with the drafting of your individually-designed Plan Documents (with your attorney's review) and submitting them to the IRS. If you prefer, you may retain outside counsel to perform these services.
Turn to McCready and Keene to assist with the processing of your Plan Termination through distribution and pension risk transfer. This Termination process includes amendments to freeze and terminate the plan (prepared for your attorney's review), calculation of benefits, and preparation of all required notices to participants, submission to the IRS and the PBGC, and more.
As a plan sponsor, you have a fiduciary obligation to inform and educate your employees about their retirement plan options. We can help you with your employee education needs by offering the following: employee meetings, easy-to-understand PowerPoint presentations, and informative written materials. Not only can we help you explain the plan, but we can help your employees to better understand the value of the benefit you are providing.
Adjusting retirement plans to accommodate mergers, acquisitions and spin-offs can be complicated. Our consultants and attorneys are very experienced with the testing, documentation and other issues associated with handling of retirement plans during ownership changes.
To remain in compliance with IRS and DOL regulations, plan sponsors need accurate and timely calculations indicating how much they must contribute to their plans. We give our clients valuations that offer a range of contributions, from the required minimum to the suggested minimum to the maximum deductible amount. We also include an executive summary that gives clients a three-year overview of their critical balances or calculations so they know their status, plus we indicate any trends we see developing. Our comprehensive annual Actuarial Valuation comes complete with summaries of:
- Plan provisions
- Actuarial methods and assumptions
- All levels of contribution funding requirements, minimum to maximum
- Quarterly contributions, including liquidity of funding shortfall if any
- AFTAP, FTAP, Funding Percentage, Annualized Return, and Target Normal cost calculations
- Special funding considerations
- Present value of accrued benefits
- Participant data.
In addition, we can prepare participant listings for active participants, limited participants, retirees, terminated vested participants, beneficiaries, and participants over normal retirement age. If requested, we can also prepare participant statements showing projected retirement benefits, projected Social Security benefits, and if desired, accrued retirement benefits. Other available services include preparation of benefits, completion of Form 5500, non-discrimination testing, and actuarial studies.
We take a different approach to ASC 715-30 reporting. Instead of providing the required calculations at the end of the fiscal year and bundling them into the annual Actuarial Valuation, we provide the calculations in a separate report. When preparing the report we disclose your current fiscal year, plus estimate the pension cost for the next fiscal year. This takes the pressure off you and your accountants, and gives you a head start on planning for the upcoming year.
With our nearly 80 years of experience with qualified retirement plans and our staff of compliance experts, it's hardly surprising that McCready and Keene has gained a national reputation as a leader in compliance testing. We're unwavering in our efforts to keep clients in full compliance with all applicable IRS, ERISA (Department of Labor) and PBGC rules and regulations so that plans don't lose their favored tax status. The list of compliance services we offer is comprehensive and includes:
- Determination of Highly Compensated Employees
- Determination of Key Employees
- Code Section 410(b) Coverage Testing
- Code Section 415 Maximum Annual Addition Testing
- Code Section 404 Maximum Deduction Assistance
- Code Section 414(s) Compensation Testing
- 70-1/2 Minimum Distribution Calculations
- PBGC Forms and Premiums
- Form 5500 including Schedules and annual funding notice
- 1099-R preparation
- Average Benefits Testing
- General Testing
- Top-Heavy Testing
- New Comparability Testing
- Other Non-Discrimination Testing
- Document Requirements including Plan Document, restatements, amendments, resolutions, minutes, SPDs, SMMs, submission, 204(h) Notices, suspension of benefits notices, and other notices as needed to comply with IRS, ERISA, and PBGC rules
- Excise Tax Assistance including calculation and Forms completion
- Distribution Paperwork, including Joint and Survivor Notices and the Special Tax Notice
- Plan Termination, Full Service for defined benefit plans.
One of the key requirements of keeping your plan in compliance with federal rules and regulations is the filing of a Form 5500 and its many schedules. The penalties for non-filing of Form 5500 are severe, so McCready and Keene maintains a proprietary tracking system that ensures your forms are completed on time. If required information is not available to meet the filing deadline, we can file an extension, enabling you to avoid any penalties. As part of our 5500 services we will prepare an annual summary report for your participants.
Our clients find that our ability to work seamlessly with their other advisors, including their CPAs, attorneys and financial advisors, means they save time and money, plus they avoid potential mistakes that can bring unwanted attention from the IRS, the Department of Labor, or the PBGC.