2009 Instructions For Schedule Sb (Form 5500) Single-Employer Defined Benefit Plan Actuarial Information (Page 2 of 11) in pdf

The Pension Protection Act of 2006, as amended (PPA),

Attachments

provides delayed effective dates for the new funding rules for

All attachments to the Schedule SB must be properly identified

plans meeting certain criteria (certain multiple-employer plans

as attachments to the Schedule SB, and must include the name

maintained by rural cooperatives or related organizations,

of the plan, plan sponsor’s EIN, plan number, and line number

PBGC settlement plans, and certain plans maintained by

to which the schedule relates. When assembling the package

government contractors, as described in PPA sections 104

for filing, attachments for a schedule should be placed either

through 106). Eligible plans to which these delayed effective

directly behind that schedule or at the end of the filing.

dates apply do not need to complete the entire Schedule SB,

Do not include attachments that contain a visible social

but will have to file information relating to pre-PPA calculations

security number. Except for certain one-participant plans, the

in an attachment using the 2007 Schedule B form. See the

Schedule SB and its attachments are open to public inspection,

instructions for line 27 for more information about which lines of

and the contents are public information and are subject to

Schedule SB need to be completed and what additional

publication on the Internet. Because of privacy concerns, the

attachments are required.

inclusion of a visible social security number on an attachment

may result in the rejection of the filing.

PPA provides funding relief for certain defined benefit plans

(other than multiemployer plans) maintained by a commercial

Specific Instructions for Part I — Basic

passenger airline or by an employer whose principal business is

Information

providing catering services to a commercial passenger airline,

Note. All entries in Part I must be reported as of the valuation

based on an alternative 17-year funding schedule. Plans using

date.

this funding relief do not need to complete the entire Schedule

Line 1. Valuation Date. The valuation date for a plan year

SB, but are required to provide supplemental information as an

must be the first day of the plan year unless the plan meets the

attachment to Schedule SB. Alternatively, these plans can elect

small-plan exception of ERISA section 303(g)(2)(B) and Code

to apply the funding rules generally applicable to

section 430(g)(2)(B). For plans that qualify for the exception,

single-employer defined benefit plans, but amortize the funding

the valuation date may be any date in the plan year, including

shortfall over 10 years instead of the standard 7-year period

the first or last day of the plan year.

and use a special interest rate to determine the funding target.

Plans using this 10-year funding option must complete the

A plan qualifies for this small-plan exception if there were

entire Schedule SB and provide additional information. See the

100 or fewer participants on each day of the prior plan year. For

instructions for line 27 for more information about which lines of

the definition of participant, as it applies in this case, see the

Schedule SB need to be completed and what additional

instructions for line F.

attachments are required.

Line 2a. Market Value of Assets. Enter the fair market value

of assets as of the valuation date. Include contributions

Notes. (1) For split-funded plans, the costs and contributions

designated for any previous plan year that are made after the

reported on Schedule SB should include those related to both

valuation date (but within the 8

-month period after the end of

trust funds and insurance carriers. (2) For terminating plans,

the prior plan year), adjusted for interest for the period between

Rev. Rul. 79-237, 1979-2 C.B. 190, provides that minimum

the date of payment and the valuation date as provided in the

funding standards apply until the end of the plan year that

applicable regulations.

includes the termination date. Accordingly, the Schedule SB is

Contributions made for the current plan year must be

not required to be filed for any later plan year. However, if a

excluded from the amount reported in line 2a. If these

termination fails to occur — whether because assets remain in

contributions were made prior to the valuation date (which can

the plan’s related trust (see Rev. Rul. 89-87, 1989-2 C.B. 81) or

only occur for small plans with a valuation date other than the

for any other reason (e.g., the PBGC issues a notice of

first day of the plan year), the asset value must be adjusted to

noncompliance pursuant to 29 CFR section 4041.31 for a

exclude not only the contribution amounts, but interest on the

standard termination) — there is no termination date, and

contributions from the date of payment to the valuation date,

therefore, minimum funding standards continue to apply and a

using the current-year effective interest rate.

Schedule SB continues to be required.

Do not adjust for items such as the funding standard

carryover balance, prefunding balance, any unpaid minimum

Statement by Enrolled Actuary

required contributions, or the present value of remaining

An enrolled actuary must sign Schedule SB. The signature of

shortfall or waiver amortization installments. Rollover amounts

the enrolled actuary may be qualified to state that it is subject to

or other assets held in individual accounts that are not available

attached qualifications. See Treasury Regulations section

to provide defined benefits under the plan should not be

301.6059-1(d) for permitted qualifications. If the actuary has not

included on line 2a regardless of whether they are reported on

fully reflected any final or temporary regulation, revenue ruling,

the Schedule H (Form 5500) (line 1l, column (a)) or Schedule I

or notice promulgated under the statute in completing the

(Form 5500) (line 1c, column (a)), or Form 5500-SF (line 7c,

Schedule SB, check the box on the last line of page 1. If this

column (a)). Additionally, asset and liability amounts must be

box is checked, indicate on an attachment whether any unpaid

determined in a consistent manner. Therefore, if the value of

required contribution or a contribution that is not wholly

any insurance contracts has been excluded from the amount

deductible would result if the actuary had fully reflected such

reported in line 2a, liabilities satisfied by such contracts should

regulation, revenue ruling, or notice, and label this attachment

also be excluded from the funding target values reported in

“Schedule SB – Statement by Enrolled Actuary.” Except as

lines 3 and 4.

otherwise provided in these instructions, a stamped or machine

Line 2b. Actuarial Value of Assets. If an averaging method is

produced signature is not acceptable.

used to value plan assets (as permitted under Code section

430(g)(3)(B) and ERISA section 303(g)(3)(B)), as amended by

The actuary must provide the completed and signed

WRERA, enter the value as of the valuation date taking into

Schedule SB to the plan administrator to be retained with the

account the requirement that such value must be within 90% to

plan records and included (in accordance with these

110% of the fair market value of assets.

instructions) with the Form 5500 or Form 5500-SF that is

submitted under EFAST2. The plan’s actuary is permitted to

Do not adjust the actuarial value of assets for items such as

sign the Schedule SB on page one using the actuary’s

the funding standard carryover balance, the prefunding

signature or by inserting the actuary’s typed name in the

balance, unpaid minimum required contributions, or the present

signature line followed by the actuary’s handwritten initials. The

value of any remaining shortfall or waiver amortization

actuary’s most recent enrollment number must be entered on

installments. Treat contributions designated for a current or

the Schedule SB that is prepared and signed by the plan’s

prior plan year, rollover amounts, insurance contracts, and

actuary.

other items in the same manner as for line 2a.

-56-

Instructions for Schedule SB (Form 5500)

2009 Instructions For Schedule Sb (Form 5500) Single-Employer Defined Benefit Plan Actuarial Information Page 2

Related Articles

Related forms

Related Categories