43. Optional forms of benefit must be stated in the plan

Statement of Requirement: IRC 401(a)(4), 411(d)(6) and 417(g); Treas. Reg. 1.401(a)(4)-4, 1.411(d)-4; Notice 97-75; Notice 200830; Rev. Proc. 2023-37, 9.03(5)

Document Provision: _____

Sample Plan Language:

The optional forms of benefit provided by this plan are as follows:

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(Note to reviewer: Effective for plan years beginning on or after December 31, 2007, all plans must include a qualified optional survivor annuity (QOSA), which is an annuity for the life of the participant with a survivor annuity for the life of the spouse (see LRM #46). The QOSA must provide a survivor benefit of:

I. 75%, if the plan’s qualified joint and survivor annuity provides a survivor benefit of less than 75% of the annuity payable during the joint lives of the participant and spouse, or

II. 50%, if the plan’s qualified joint and survivor annuity provides a survivor benefit of 75% or more of the annuity payable during the joint lives of the participant and spouse.

If a plan already includes an optional joint and survivor annuity that satisfies the QOSA requirements, no change is required.)

(Note to reviewer: The availability of each optional form of benefit must not be subject to employer discretion. In addition, each optional form of benefit provided under a Standardized Plan (other than any that has been prospectively eliminated) must be currently available to all employees benefiting under the plan. This is the case regardless of whether a particular form of benefit is the actuarial equivalent of any other optional form of benefit under the plan.)

(Note to reviewer: IRC 411(d)(6) prevents a plan from retroactively reducing or eliminating optional forms of benefits and any other IRC 411(d)(6) protected benefits with respect to benefits attributable to service before the amendment, except as expressly provided under Treas. Reg. 1.411(d)-4 (see LRM #66)).

98 | Defined Benefit Plan LRM Package 06/2026

(Note to reviewer: An employer that decides to eliminate the availability of a preretirement optional form of benefit (defined in LRM #51) for a participant (other than a 5% owner) who attained age 70½ after a specified year has relief from the applicable sections of IRC 401(a)(4) under Notice 97-75. An optional form of benefit available to a 5% owner at age 70½ and retirement and to other participants only at retirement will be treated as the same optional form of benefit for purposes of testing the nondiscriminatory availability of benefits, rights, and features. Additional relief is provided as stated in Notice 97-75.)