Content area
Abstract
There has been a lot of talk concerning Section 412(i) plans in recent months. Enough talk to make a practitioner think that Section 412(i) was invented last Tuesday. This "new" type of pension plan is really based on an old section of the Internal Revenue Code. 412(i) plans can do things that non-412(i) plans can't do. The requirements for section 412(i) fully insured defined benefit plans are, relatively speaking, the same as any requirements for any plan qualified under Code section 401(a). Qualified plan rules are strict and failure to adhere to them carry draconian consequences. There are promoters in the marketplace who believe that the great chain of the Internal Revenue Code, Labor Regulations, and ERISA can be massaged and manipulated to create the illusion of grandeur-paying nothing for something. Advisors and consultants will want to put the 412(i) plan in their arsenal for those clients whose paramount desire is the guaranteed benefit.