EXAMPLE
01.Core Concepts
• Assume a DB Plan is determined to be top-heavy • The Nontop-Heavy Formula = 1.5% x avg. 3 highest years comp x years of service • Assume an employee has 10 years of service and avg. comp of $100,000. • Under formula = 1.5% x $100,000 x 10 = $15,000 • What is the top-heavy benefit?