Calculating the 415 Limit for Employers with Terminated DB Plans (Posted September 8, 2003) Technical Tip 104: The following question and answer were from the IRS Q&A Session at the 2002 ASPPA Annual Conference: Plan sponsor terminated DB many years ago. Adopts new DB. In determining years of service for 10 years of participation requirement under IRC 415, are years under old plan considered? Response: Since plans must be aggregated for 415 purposes, the years will count. Comment by RLR&C ERISA attorneys: A participant in a defined benefit plan may not receive an annual benefit of more than $160,000 or 100% of the participant's average compensation for his highest 3 years. IRC 415(b)(5) provides that these limits are reduced in the case of an employee with less than 10 years of service or participation. IRC § 415(f)(1) provides that all defined benefit plans of an employer, regardless of whether they have been terminated, are considered to be one plan for purposes of these limits. Thus, as indicated above, a participant's years of service under the employer's terminated defined benefit plan are counted for purposes of determining whether the limit must be reduced for the participant. View all Tips © 2012 Reish Luftman Reicher & Cohen, a Professional Corporation Important notice: Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner's situation. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of your situation.