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Quiz: Specified Multi-Employer Plan (SMEP)

5 questions

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1 Which conditions must a multi-employer plan meet to be a specified multi-employer plan? Select all that apply.

Select all that apply.

The plan provides money purchase benefits only The plan has at least ten participating employers Employer contributions are determined under a collective agreement rather than by the plan's funding requirements No more than 95% of the active members are employed by a single participating employer

Answer key unconfirmed — rests on 4 unverified claims.

2 How is the pension adjustment determined for a SMEP member, and why? On a contribution basis, in the same manner as a money purchase provision, even where the plan provides a defined benefit By whichever method the plan administrator elects By the defined benefit method, but using contributions in place of benefit entitlement By the defined benefit method, since the plan provides a defined benefit

Answer key unconfirmed — rests on 3 unverified claims.

3 A SMEP member moves from one participating employer to another within the same plan. Does a PAR arise? No — moving between participating employers within the plan is not a termination of plan membership Yes, but only if the member's contributions cease for a period No, and a PAR can never arise in a SMEP Yes — leaving an employer ends membership

Answer key unconfirmed — rests on 2 unverified claims.

4 Does the annual pension adjustment cap apply to SMEP members? No — SMEP members are exempt from the PA cap Yes — the lesser of the money purchase limit for the year and 18% of compensation applies Only the percentage applies, not the money purchase limit Only the money purchase limit applies, not the percentage

Answer key unconfirmed — rests on 1 unverified claim.

5 How do the past service pension adjustment rules apply to specified multi-employer plans? PSPAs arise but require no certification in any case In full, as for any defined benefit provision PSPAs never arise in a SMEP under any circumstances SMEPs are subject to exemptions from the PSPA rules that apply to ordinary defined benefit provisions

Answer key unconfirmed — rests on 1 unverified claim.

Unanswered questions are marked wrong. There is no partial credit.