Скачать или смотреть Defined Benefit Plans

Defined benefit plans guarantee a specified retirement benefit, often calculated as a percentage of preretirement pay multiplied by years of service, and paid as a lifetime annuity. Employer contributions vary annually based on funding needs and life expectancy projections, which have increased in recent years. Two main benefit formulas exist: flat benefit formulas, which do not factor in years of service, and unit benefit formulas, which do.

Flat benefit formulas may provide a set dollar amount per employee or a percentage of final average pay, often based on the last three or four years of service. Unit benefit formulas link benefits to years of service, using either a fixed dollar or percentage per year worked. Plans must meet uniformity standards and safe harbor rules to prevent inconsistent or discriminatory benefit allocations.

Accumulated benefit obligation measures the present value of earned benefits, calculated by actuaries considering investment returns, service length, and life expectancy. The IRS enforces anti-backloading rules, including the 3% rule, 133⅓% rule, and fractional rule, to ensure benefits accrue evenly over time. ERISA requires sufficient annual employer contributions, actuarial reporting, and compliance reviews, and the IRC caps annual benefits at the lesser of $200,000 (2012, indexed for inflation) or 100% of the highest three-year average compensation.