Form 5624 - Employee Benefit Plan Defined Benefit Plans Minimum Vesting Standards (Page 5 of 6) in pdf

If a participant does not accrue the “normal retirement benefit” by normal

Plan Reference

Yes No N/A

retirement age, are years of participation after normal retirement age counted

for purposes of meeting the requirement that the benefit accrued at the rate

of at least 3 percent a year? [2062]

Does the plan specify the accrual of the “normal retirement benefit” will be

a rate of at least 3 percent of the benefit for each year of participation? [2062]

Check “Yes” if the 3 percent test is satisfied. (If all answers above are “Yes,”

this test is satisfied.) If this test is satisfied, do not complete remainder of this

section.

If the answer to B., C., and D. is “Yes,” but the answer to E. is “No,” then

complete F.

F. Can it be demonstrated mathematically that the plan’s “normal retirement

benefit” accrues at a rate of at least 3 percent for each year of participation?

In making this calculation, assume the earliest possible entry age under the

plan. (If no entry age is specified, assume 0.) See the explanation for

guidance in making your mathematical computations. [2062]

iii.

Fractional Rule

If the plan benefit is based on average compensation, is the average

based on compensation for a period no greater than the 10 years of service

immediately before the date the benefit is determined? [2062]

Does the plan’s benefit accrue at the same rate for all years? [2062]

If the answers to A. and B. are “Yes,” this rule is satisfied.

Is it clear from the language of the plan that if a participant terminates

service in year Y that the accrued benefit at Y is at least equal to the product

of the plan’s normal retirement benefit times a fraction of the actual years of

participation from entry to Y over the years of service from entry to normal

retirement age? [2062]

Coordinating Accrual Rules with Top-Heavy Rules

Do the accrual benefit rules properly coordinate with the top-heavy rules? [2078]

Allocation of Accrued Benefits Between Employer and Employee Contributions

If the plan does not provide for employee contributions, DO NOT complete this

section.

Does the plan maintain separate accounts for voluntary employee

contributions? (If no voluntary contributions are permitted, check “N/A” ) [2081]

ii.

Does the plan define the accrued benefit that is the result of employer

contributions as the total accrued benefit less the accrued benefit that is the result

of mandatory employee contributions? [2082]

iii.

If the plan provides for mandatory employee contributions, does it correctly

determine the accrued benefit that resulted from these contributions? [2083]

iv.

Is the interest credited to mandatory contributions calculated in accordance

with section 411(c)(2)(C)? [2084, 2085]

5624

Form

(Rev. 12-98) (page 5)

Department of the Treasury - Internal Revenue Service

Form 5624 - Employee Benefit Plan Defined Benefit Plans Minimum Vesting Standards Page 5

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