CPC Plan Termination & Mergers Flashcards
6 cards from real CPC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CPC Plan Termination & Mergers flashcards as text
What is the 'look-back' rule regarding successor plans that affects the plan termination exception to the 10% early withdrawal penalty?
Answer: If the employer establishes a new plan within 12 months after termination, the penalty exception is lost
The plan termination penalty exception is unavailable if the employer establishes or maintains a defined contribution plan within 12 months before or after the plan's termination date.
Which parties must receive Notice of Intent to Terminate (NOIT) in a standard defined benefit plan termination?
Answer: Plan participants, beneficiaries, alternate payees, and unions representing plan participants
The NOIT must be provided to all plan participants, beneficiaries currently receiving benefits, alternate payees under QDROs, and any union representing plan employees.
In a defined benefit plan termination, what is the 'missing participant' program administered by the PBGC?
Answer: A program where the plan transfers benefits of unlocatable participants to the PBGC, which then holds the benefits and locates participants
The PBGC's missing participants program allows terminating plans to transfer the benefits of unlocatable participants to the PBGC, which holds and pays benefits when participants are found.
An employer maintains a defined benefit plan and a defined contribution plan. In a merger where only the DB plan is transferred, what is the primary concern under Section 414(l)?
Answer: Whether assets assigned to each resulting plan are sufficient to pay benefits if those plans had terminated on the merger date
Section 414(l) requires that in a merger or consolidation, each resulting plan must have sufficient assets to pay benefits equal to what each participant would have received if the plan had terminated immediately before the merger.
After a standard defined benefit plan termination, within how many days of completing distributions must the plan administrator file the post-distribution certification with the PBGC?
Answer: 60 days
The plan administrator must file PBGC Form 501 (Post-Distribution Certification) within 30 days after the last distribution date of the standard termination.
When a multiemployer defined benefit plan terminates due to mass withdrawal, how are employers liable?
Answer: All contributing employers are jointly and severally liable for the plan's unfunded vested benefits
Upon mass withdrawal termination of a multiemployer plan, all employers who contributed to the plan become jointly and severally liable for the plan's unfunded vested benefits.