2009 Schedule SB Instructions

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Table of Contents
General Instructions
Specific Instructions

General Instructions Return to top

Note. Proposed regulations under Code sections 430, 436, and 4971 and ERISA sections 206(g) and 303 were published in the Federal Register on May 29, 2007, August 31, 2007, December 31, 2007, and April 15, 2008. However, with the exception of sections 1.430(h)(3)-1 and 54.497(c)-1 of the proposed regulations, the provisions of the final regulations will not be effective until the plan year beginning in 2010. With respect to those provisions proposed to become effective after 2008, plan sponsors may rely on the provisions of the proposed or final regulations for plan years beginning in 2008 or 2009, or they may generally follow a reasonable interpretation of the funding rules in the statute, taking into account the provisions of the Worker, Retiree, and Employer Recovery Act of 2008 ("WRERA") and any other amendments to the funding rules that are enacted.

Who Must File Return to top

As the first step, the plan administrator of any single-employer defined benefit plan (including a multiple-employer defined benefit plan) that is subject to the minimum funding standards (see Code section 412 and Part 3 of Title I of ERISA) must obtain a completed Schedule SB that is prepared and signed by the plan's enrolled actuary as discussed below in the Statement by Enrolled Actuary section. The plan administrator must retain with the plan records the Schedule SB that is prepared and signed by the plan's actuary.

Next, the plan administrator must ensure that the information from the actuary's Schedule SB is entered electronically into the annual return/report being submitted. When entering the information, whether using EFAST2-approved software or EFAST 2's web-based filing system, all the fields required for the type of plan must be completed (see instructions for fields that need to be completed).

Further, the plan administrator of a single-employer defined benefit plan must attach to the Form 5500 or Form 5500-SF an electronic reproduction of the Schedule SB prepared and signed by the plan's enrolled actuary. This electronic reproduction must be included as a Portable Document Format (PDF) attachment to the Form 5500 or Form 5500-SF and labeled "SB Actuary Signature."

Note. The Schedule SB (Form 5500) does not have to be filed with the Form 5500-EZ, but it must be retained (in accordance with the Instructions for Form 5500-EZ under the What To File section. Similarly, if a plan is a one-participant plan that meets the requirements for filing a Form 5500-EZ, but a Form 5500-SF is instead filed for the plan, the Form 5500-SF. However, it must be retained in accordance with the Instructions for Form 5500-SF under the section headed Specific Instructions Only for "One-Participant Plans." The enrolled actuary must complete and sign the Schedule SB and forward it to the person responsible for filing the Form 5500-EZ, even if the Schedule SB is not filed.

Check the Schedule SB box on the Form 5500 (Part II, line 10a(3) if a Schedule SB is attached to Form 5500. Check "Yes" on line 11 in Part VI of the Form 5500-SF if a Schedule SB is not required to be attached to Form 5500-SF (see instructions in Note Section above, pertaining to "one-participant plans").

Note. This schedule is not filed for a multiemployer plan nor for a money purchase defined contribution plan (including a target benefit plan) for which a waiver of the minimum funding requirement is currently being amortized. Information for these plans must be filed using Schedule MB (Form 5500).

Lines A through F. Identifying Information. top Lines A - E must be completed by all plans. If the Schedule SB is attached to a Form 5500 or Form 5500-SF, lines A through D should include the same information as reported in corresponding lines in Part II of the Form 5500, Form 5500-SF, or Form 5500-EZ. You may abbreviate the plan name (if necessary) to fit in the space provided.

Do not use a social security number in line D instead of an EIN. The Schedule SB and its attachments are open to public inspection if filed with a Form 5500 or Form 5500-SF, and the contents are public information and are generally subject to publication on the Internet. Because of privacy concerns, the inclusion of a social security number on the Schedule SB or any of its attachments may result in the rejection of the filing.

You can apply for an EIN from the IRS online, by telephone, by fax, or by mail depending on how soon you need to use the EIN. For more information, see Section 3: Electronic Filing Requirements under General Instructions to Form 5500. The EBSA does not issue EINs.

Line E. Type of Plan. top Check the applicable box to indicate the type of plan. A single-employer plan for this reporting purpose is an employee benefit plan maintained by one employer or one employee organization. A multiple-employer plan is a plan that is maintained by more than one employer, but is not a multiemployer plan. (See the Instructions for From 5500, box A(1) for additional information on the definition of a multiemployer plan.)

If "Multiple-A" is checked, compute the entries on Schedule SB filed for the plan as the sum of the individual amounts computed for each employer. Complete a Schedule SB for each employer showing information relative to that employer's portion of the plan, and submit them as an attachment to the Schedule SB for the plan. Label the attachment "Schedule SB - Information for Each Individual Employer."

Line F. Prior Year Plan Size. top Check the applicable box based on the highest number of participants (both active and inactive) on any day of the preceding plan year, taking into account participants in all defined benefit plans maintained by the same employer (or any member of such employer's controlled group) who are or were also employees of that employer or member. For this purpose, participants whose only defined benefit plan is a multiemployer plan (as defined in Code section 414(f)) are not counted, and participants who are covered in more than one of the defined benefit plans described above are counted only once. Inactive participants include vested terminated and retired employees as well as beneficiaries of deceased participants. If this is the first plan year that a plan described in this paragraph exists, complete this line based on the highest number of participants that the plan is reasonably expected to have on any day during the first plan year.

General Instructions, Parts I through VIII, Statement by Enrolled Actuary, and Attachments Return to top

Except as noted below, all single and multiple-employer defined benefit plans, regardless of size or type, must complete Parts I through VIII. See instructions for line 27 for additional information to be provided for certain plans with special circumstances.

The Pension Protection Act of 2006, as amended (PPA), provides delayed effective dates for the new funding rules for plans meeting certain criteria (certain multiple-employer plans maintained by rural cooperatives or related organizations, PBGC settlement plans, and certain plans maintained by government contractors, as described in PPA sections 104 through 106). Eligible plans to which these delayed effective dates apply do not need to complete the entire Schedule SB, but will have to file information relating to pre-PPA calculations in an attachment using the 2007 Schedule B form. See the instructions for line 27 for more information about which lines of Schedule SB need to be completed and what additional attachments are required.

PPA provides funding relief for certain defined benefit plans (other than multiemployer plans) maintained by a commercial passenger airline or by an employer whose principal business is providing catering services to a commercial passenger airline, based on an alternative 17-year funding schedule. Plans using this funding relief do not need to complete the entire Schedule SB, but are required to provide supplemental information as an attachment to Schedule SB. Alternatively, these plans can elect to apply the funding rules generally applicable to single-employer defined benefit plans, but amortize the funding shortfall over 10 years instead of the standard 7-year period and use a special interest rate to determine the funding target. Plans using this 10-year funding option must complete the entire Schedule SB and provide additional information. See the instructions for line 27 for more information about which lines of Schedule SB need to be completed and what additional attachments are required.

Note. (1) For split-funded plans, the costs and contributions reported on Schedule SB should include those related to both trust funds and insurance carriers. (2) For terminating plans, Rev. Rul. 79-237, 1979-2 C.B. 190, provides that minimum funding standards apply until the end of the plan year that includes the termination date. Accordingly, the Schedule SB is not required to be filed for any later plan year. However, if a termination fails to occur - whether because assets remain in the plan's related trust (see Rev. Rul. 89-87, 1989-2 C.B. 81) or for any other reason (e.g., the PBGC issues a notice of noncompliance pursuant to 29 CFR section 4041.31 for a standard termination) - there is no termination date, and therefore, minimum funding standards continue to apply and a Schedule SB continues to be required.

Statement by Enrolled Actuary Return to top

An enrolled actuary must sign Schedule SB. The signature of the enrolled actuary may be qualified to state that it is subject to attached qualifications. See Treasury Regulations section 301.6059-1(d) for permitted qualifications. If the actuary has not fully reflected any final or temporary regulation, revenue ruling, or notice promulgated under the statute in completing the Schedule SB, check the box on the last line of page 1. If this box is checked, indicate on an attachment whether any unpaid required contribution or a contribution that is not wholly deductible would result if the actuary had fully reflected such regulation, revenue ruling, or notice, and label this attachment "Schedule SB - Statement by Enrolled Actuary." A stamped or machine produced signature is not acceptable.

The actuary must provide the completed and signed Scheduel SB to the plan admininstrator to be retained with the plan records and included (in accordance with these instructions) with the Form 5500 or Form 5500-SF that is submitted under EFAST2. The actuary's most recent enrollment number must be entered on the Schedule SB that is prepared and signed by the plan's actuary.

Attachments Return to top

All attachments to the Schedule SB must be properly identified as attachments to the Schedule SB, and must include the name of the plan, plan sponsor's EIN, plan number, and line number to which the schedule relates. When assembling the package for filing, attachments for a schedule should be placed either directly behind that schedule or at the end of the filing.

Do not include attachments that contain a visible social security number. Except for certain one-participant plans, the Schedule SB and its attachments are open to public inspection, and the contents are public information and are subject to publication on the Internet. Because of privacy concerns, the inclusion of a visible social security number on an attachment may result in the rejection of the filing.

Specific Instructions for Part I - Basic Information Return to top

Note. All entries in Part I must be reported as of the valuation date.

Line 1. Valuation Date. Top The valuation date for a plan year must be the first day of the plan year unless the plan meets the small-plan exception of ERISA section 303(g)(2)(B) and Code section 430(g)(2)(B). For plans that qualify for the exception, the valuation date may be any date in the plan year, including the first or last day of the plan year.

A plan qualifies for this small-plan exception if there were 100 or fewer participants on each day of the prior plan year. For the definition of participant, as it applies in this case, see the instructions for line F.

Line 2a. Market Value of Assets. Top Enter the fair market value of assets as of the valuation date. Include contributions designated for the previous plan year that are made after the valuation date (but within the 8 ½-month period after the end of the prior plan year), adjusted for interest for the period between the date of payment and the valuation date using the effective interest rate for the prior plan year.

Contributions made for the current plan year must be excluded from the amount reported in line 2a. If these contributions were made prior to the valuation date (which can only occur for small plans with a valuation date other than the first day of the plan year), the asset value must be adjusted to exclude not only the contribution amounts, but interest on the contributions from the date of payment to the valuation date, using the current-year effective interest rate.

Do not adjust for items such as the funding standard carryover balance, prefunding balance, any unpaid minimum required contributions, or the present value of remaining shortfall or waiver amortization installments. Rollover amounts or other assets held in individual accounts that are not available to provide defined benefits under the plan should not be included on line 2a regardless of whether they are reported on the Schedule H (Form 5500) (line 1l, column (a)) or Schedule I (Form 5500) (line 1c, column (a)), or Form 5500-SF (line 7c, column (a)). Additionally, asset and liability amounts must be determined in a consistent manner. Therefore, if the value of any insurance contracts has been excluded from the amount reported in line 2a, liabilities satisfied by such contracts should also be excluded from the funding target values reported in lines 3 and 4.

Line 2b. Actuarial Value of Assets. Top If an averaging method is used to value plan assets (as permitted under Code section 430(g)(3)(B) and ERISA section 303(g)(3)(B)), as amended by WRERA, enter the value as of the valuation date taking into account the requirement that such value must be within 90% to 110% of the fair market value of assets.

Do not adjust the actuarial value of assets for items such as the funding standard carryover balance, the prefunding balance, unpaid minimum required contributions, or the present value of any remaining shortfall or waiver amortization installments. Treat contributions designated for a current or prior plan year, rollover amounts, insurance contracts, and other items in the same manner as for line 2a.

Note. Under Code section 430(g)(3)(B), the use of averaging methods in determining the value of plan assets is permitted only in accordance with methods prescribed in Treasury Regulations. Accordingly, for plan years beginning in 2009, taxpayers cannot use asset valuation methods other than fair market value (as described in Code section 430(g)(3)(A)), except as provided under Notice 2009-22, 2009-14, I.R.B. 741 and Treasury Regulations that reflect the amendments made by WRERA. An actuarial value of assets calculated using the averaging method provided by PPA prior to amendment by WRERA (which does not reflect expected earnings) is not permitted for the plan year that begins in 2009, regardless of whether that method was used to determine the actuarial value of assets for the plan year beginning in 2008.

Line 3. Funding Target/Participant Count Breakdown. Top All amounts should be reported as of the valuation date.

Unless the plan sponsor has received approval to use substitute mortality tables in accordance with ERISA section 303(h)(3)(C) and Code section 430(h)(3)(C), the funding target must be computed using the mortality tables for non-disabled lives, as published in section 1.430(h)(3)-1 of the Income Tax Regulations. If substitute mortality tables have been approved (or deemed to have been approved) by the IRS, such tables must be used instead of the mortality tables described in the previous sentence, subject to the rules of ERISA section 303(h)(3) and Code section 430(h)(3). The funding target may be computed taking into account the mortality tables for disabled lives published in Rev. Rul. 96-7, 1996-1 C.B. 59, and as provided in Notice 2008-29, 2008-12 I.R.B. 637.

Special rules for plans that are in at-risk status. Top If a plan is in at-risk status, report the amount reflecting the additional assumptions required in ERISA section 303(i)(1)(B) and Code section 430(i)(1)(B).

If the plan has been in at-risk status for any two or more of the preceding four plan years, also include the loading factor required in ERISA section 303(i)(1)(C) and Code section 430(i)(1)(C). If the plan is in at-risk status and has been in at-risk status for fewer than five consecutive years, report the funding target amounts after reflecting the transition rule provided in ERISA section 303(i)(5) and Code section 430(i)(5). Years beginning before 2008 do not count for this purpose. Thus, for example, the funding target for any plan that is in at-risk status for the 2008 and 2009 plan years will reflect 40% of the funding target using the special at-risk assumptions and 60% of the funding target determined without regard to the at-risk assumptions.

Determining whether a plan is in at-risk status. Top Refer to ERISA section 303(i)(4) and Code section 430(i)(4) to determine whether the plan is in at-risk status. Generally, a plan is in at-risk status for a plan year if it had more than 500 participants on any day during the preceding plan year (see instructions for line F for the definition of participants) and the plan's funding target attainment percentage ("FTAP") falls below specified thresholds.

A plan with over 500 participants is in at-risk status for 2009 if the FTAP for 2008 (line 14 of the 2008 Schedule SB) is less than 70%.

Line 4. Additional Information for Plans in At-Risk Status. Top If the plan is in at-risk status as provided under ERISA section 303(i)(4) and Code section 430(i)(4), check the box, complete lines 4a and 4b, and include as an attachment the information described below. Do not complete line 4 if the plan is not in at-risk status for the current plan year.

If the plan is in at-risk status for the current plan year, attach a description of the at-risk assumption for assumed form of payment (i.e., optional form resulting in the highest present value). Label the attachment "Schedule SB, line 4 - Additional Information for Plans in At-Risk Status."

Line 5. Effective Interest Rate. Top Enter the single rate of interest which, if used instead of the interest rate(s) reported in line 21 to determine the present value of the benefits that are taken into account in determining the plan's funding target for a plan year, would result in an amount equal to the plan's funding target determined for the plan year, without regard to calculations for plans in at-risk status. (This is the funding target reported in line 3d(2) for plans not in at-risk status, or in line 4a for plans in at-risk status.) However, if the funding target for the plan year is zero, the effective interest rate is determined as the single rate that would result in an amount equal to the plan's target normal cost determind for the plan year, without regard to calculations for plans in at-risk status. See the provisions of Code section 430(h)(2)(A), ERISA section 303(h)(2)(A), and the applicable regulations. Enter rate to the nearest .01% (e.g., 5.26%).

Line 6. Target Normal Cost. Top Report the present value of all benefits which have been accrued or have been earned (or that are expected to accrue or to be earned) under the plan during the plan year, increased by any plan-related expenses expected to be paid from plan assets during the plan year, and decreased (but not below zero) by any madatory employee contributions expected to be made during the plan year. Include any increase in benefits during the plan year that is a result of any actual or projected increase in compensation during the current plan year, even if that increase in benefits is with respect to benefits attributable to services performed in a preceding plan year.

This amount must generally be calculated as of the valuation date and must be based on the same assumptions used to determine the funding target reported in line 3c(3), column (2), reflecting the special assumptions and the loading factor for at-risk plans, if applicable. If the plan is in at-risk status and has been for fewer than five consecutive years, report the target normal cost after reflecting the transition rule provided in ERISA section 303(i)(5) and Code section 430(i)(5).

Special rule for airlines using 10-year amortization period under section 402(a)(2) of PPA. Top Section 402(a)(2) of PPA (as amended by section 6615 of the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, Public Law 110-28 (121 Stat.112)) states that for plans electing the 10-year amortization period, the funding target during that period is determined using an interest rate of 8.25% rather than the interest rates or segment rates calculated on the basis of the corporate bond yield curve. However, this special 8.25% interest rate does not apply for other purposes, including the calculation of target normal cost or the amortization of the funding shortfall. Report the target normal cost using the interest rates or segment rates otherwise applicable under Code section 430(h)(2) and ERISA section 303(h)(2).

Specific Instructions for Part II - Beginning of Year Carryover and Prefunding Balances Return to top

Line 7. Balance at Beginning of Prior Plan Year After Applicable Adjustments. Top In general, report the amount in the corresponding column of line 13 of the prior-year Schedule SB. However, if the balance from the prior year has been adjusted so that it does not match the corresponding amount in line 13 of the prior-year Schedule SB, attach an explanation and label the attachment "Schedule SB, Line 7 - Explanation of Discrepancy in Prior Year Funding Standard Carryover Balance or Prefunding Balance." Note that elections to add interest-adjusted excess contributions or reduce balances have specific deadlines, and generally cannot be changed once they have been made.

If this is the first year for which the plan is subject to the minimum funding rules of ERISA section 303 or Code section 430, leave both columns blank.

Line 8. Portion Used To Offset Prior Year's Funding Requirement. Top Report the amount for each column from the corresponding column of line 35 of the prior-year Schedule SB. If the valuation date is not the first day of the plan year, report the amounts from line 35 of the prior-year Schedule SB, discounted to the beginning of the prior plan year using the effective interest rate for the prior plan year.

Special rule for late election to apply balances to quarterly installments. Top If an election was made to use the funding standard carryover balance or the prefunding balance to offset the amount of a required quarterly installment, but the election was made after the due date of the installment, the amount reported on line 8 is not the same as the amount reported on line 35 for the prior year, but is instead determined by discounting the amount used to satisfy the installment from the date of the election to the due date of the required installment at a rate of interest equal to the effective interest rate. An attachment to Schedule SB should explain why the amount is different. Label the attachment ""Schedule SB, line 8 - Late Election to Apply Balances to Quarterly Installments."

If this is the first year for which the plan is subject to the minimum funding rules of ERISA section 303 or Code section 430, leave both columns blank.

Line 9. Amount Remaining. Top Enter the amount equal to line 7 minus line 8 in each column.

If this is the first year that the plan is subject to the minimum funding requirements of ERISA section 303 or Code section 430, enter the amount of any credit balance at the end of the prior year (the "pre-effective plan year") on line 9, column (a), and leave line 9, column (b), blank. The amount entered on line 9, column (a) is generally the amount reported on line 9o of the 2007 Schedule B form that was submitted as an attachment to the Schedule SB for the pre-effective plan year. If there has been any adjustment to this amount so that it does not match the amount so reported for the pre-effective plan year, attach an explanation and label the attachment "Schedule SB, Line 9 - Explanation of Credit Balance Discrepancy."

Line 10. Interest on Line 9. Top Enter the actual rate of return on plan assets during the preceding plan year in the space provided. Enter the rate to the nearest .01% (e.g., 6.53%). If entering a negative number, enter a minus sign ("-") to the left of the number. In each column, enter the product of this interest rate and the amount reported in the corresponding column of line 9.

If this is the first year for which the plan is subject to the minimum funding rules of ERISA section 303 or Code section 430, leave both columns blank.

Line 11. Prior Year's Excess Contributions to be Added to Prefunding Balance. Top

Line 11a. Top Enter the amount reported in line 38 on the Schedule SB for the 2008 plan year, adjusted for interest to the valuation date for the 2008 plan year, if the amount was reported on the 2008 Schedule SB as of any other date.

Line 11b. Top Enter the effective interest rate for the prior plan year, as reported on line 5 of the Schedule SB for the prior plan year, in the space provided. Enter the rate to the nearest .01% (e.g., 6.35%). Enter the product of that rate and the amount reported on line 11a. However, if the valuation date is not the first day of the plan year, report the amount of interest (at the rate reported on this line 11b) for the period between the prior year's valuation date and the end of the prior plan year.

Note. Under the regulations, if a contribution (or a portion of a contribution) reported on line 11a is an excess contribution solely because an election was made to offset the minimum required contribution for the prior year by the funding standard carryover balance or the prefunding balance, calculate the interest on that contribution (or portion of a contribution) using the actual rate return on assets reported on line 10 instead of the effective interest rate.

Line 11c. Top Enter the sum of lines 11a and 11b.

Line 11d. Top Enter the amount of the excess contributions for the prior year (with interest) that the plan sponsor elected to use to increase the prefunding balance. This amount cannot be greater than the amount reported on line 11c.

If this is the first year for which the plan is subject to the minimum funding rules of ERISA section 303 or Code section 430, leave lines 11a-d blank.

Line 12. Top Reduction in Balances Due to Elections or Deemed Elections. In each column, enter the amount by which the employer elects to reduce (or is deemed to elect to reduce, per ERISA section 206(g)(5)(C) and Code section 436(f)(3)) the funding standard carryover balance or prefunding balance, as applicable, under ERISA section 303(f) and Code section 430(f). This amount cannot be greater than the sum of the amounts reported in the corresponding column of lines 9, 10 and, if applicable, 11d. Note that an election (or deemed election) cannot be made to reduce the prefunding balance in column (b) until the funding standard carryover balance in column (a) has been reduced to zero.

If the valuation date is not the first day of the plan year, adjust the amounts reported in line 12 to the first day of the plan year, using the effective interest rate for the current plan year. If the plan did not exist in the prior year and is not a successor plan, leave both columns blank.

If this is the first year for which the plan is subject to the minimum funding rules of ERISA section 303 or Code section 430, leave column (b) blank.

Line 13. Balance at Beginning of Current Year. Top

If this is the first year for which the plan is subject to the minimum funding rules of ERISA section 303 or Code section 430, leave column (b) blank.

Specific Instructions for Part III - Funding Percentages Return to top

Enter all percentages in this section by truncating at .01% (e.g., report 82.649% as 82.64%).

Line 14. Funding Target Attainment Percentage. Top Enter the funding target attainment percentage (FTAP) determined in accordance with ERISA section 303(d)(2) and Code section 430(d)(2). The FTAP is the ratio (expressed as a percentage) which the actuarial value of plan assets (reduced by the funding standard carryover balance and prefunding balance) bears to the funding target determined without regard to the additional rules for plans in at-risk status.

For plans that are not in at-risk status, this percentage is determined by subtracting the amount reported in line 13 from line 2b and dividing the result by the funding target reported in line 3d, column (2), for plans that are not in at-risk status (line 4a for plans that are in at-risk status). If the plan's valuation date is not the first day of the plan year, adjust the amount reported in line 13 for interest between the beginning of the plan year and the valuation date before subtracting these amounts from the amount reported in line 2b, using the effective interest rate for the current plan year.

Line 15. Adjusted Funding Target Attainment Percentage. Top Enter the adjusted funding target attainment percentage (AFTAP) determined in accordance with Code section 436(j)(2) and ERISA section 206(g)(9)(B). The AFTAP is generally the same as the FTAP reported in line 14, except that both the assets and the funding target used to calculate the AFTAP are increased by the aggregate amount of purchases of annuities for employees other than highly compensated employees (as defined in Code section 414(q)) which were made by the plan during the preceding two plan years.

See Code section 436(j)(3) and ERISA section 206(g)(9)(C) for rules regarding circumstances in which the actuarial value of plan assets is not reduced by the funding standard carryover balance and prefunding balance for certain fully-funded plans when determining the AFTAP. Note that this special rule applies only to the calculation of the AFTAP and not to the FTAP reported in line 14.

Report the final certified AFTAP for the plan year, reflecting any adjustments pertaining to the plan year subsequent to the valuation. The AFTAP reported on line 15 must reflect the final certified AFTAP for the current plan year, even if the plan administrator elects to apply the limitation on benefit accruals under Code section 436(e) and ERISA section 206(g)(4) based on the 2008 AFTAP as permitted under section 203 of WRERA.

For plans with valuation dates other than the first day of the plan year, report the AFTAP that is the final certified AFTAP based on the valuation results for the current plan year at the time that the Schedule SB is filed (reflecting contributions for the current plan year and reflecting other adjustments as described in applicable guidance), even if that AFTAP is not used to apply the restrictions under Code section 436 and ERISA section 206(g) until the following plan year.

Special rules for airlines using 10-year amortization period under section 402(a)(2) of PPA. Top Section 402(a)(2) of PPA (as amended) states that for plans electing the 10-year funding amortization period, the funding target during that period is determined using an interest rate of 8.25% rather than the interest rates or segment rates calculated on the basis of the corporate bond yield curve. Report the AFTAP for these plans based on the funding target determined using the special 8.25% interest rate.

Line 16. Prior Year's Funding Percentage for Purposes of Determining Whether Carryover/Prefunding Balances May Be Used To Offset Current Year's Funding Requirement. Top Under ERISA section 303(f)(3) and Code section 430(f)(3), the funding standard carryover balance and prefunding balance may not be applied toward minimum contribution requirements unless the ratio of plan assets for the preceding plan year to the funding target for the preceding plan year (as described in ERISA section 303(f)(3)(C) and Code section 430(f)(3)(C)) is 80% or more.

Enter the applicable percentage as described below, truncated at .01% (e.g., report 81.239% as 81.23%). In general, the percentage is the ratio that the prior-year actuarial value of plan assets (reduced by the amount of any prefunding balance, but not the funding standard carryover balance) bears to the prior-year funding target determined without regard to the additional rules for plans in at-risk status. For the 2009 plan year, this percentage is determined as follows:

Line 17. Ratio of Current Value of Assets to Funding Target if Below 70%. Top This calculation is required under ERISA section 103(d)(11). If line 2b divided by the funding target reported in line 3d, column (2), is less than 70%, enter such percentage. Otherwise, leave this line blank.

Specific Instructions for Part IV - Contributions and Liquidity Shortfalls Return to top

Line 18. Contributions Made to the Plan. Top Show all employer and employee contributions for the plan year. Include employer contributions made within 8 ½ months after the end of the plan year to the extent such contributions are designated for this plan year. Include amounts that will be allocated toward an unpaid minimum required contribution for a prior year.

Show only contributions actually made to the plan by the date Schedule SB is signed. Do not adjust contributions to reflect interest.

Certain employer contributions must be made in quarterly installments. See ERISA section 303(j) and Code section 430(j). Contributions made to meet the liquidity requirement of ERISA section 303(j)(4) and Code section 430(j)(4) should be reported. Include contributions made to avoid benefit restrictions under ERISA section 206(g) and Code section 436.

Add the amounts in both columns 18(b) and 18(c) separately and enter each result in the corresponding column on the total line. All contributions except those made to avoid benefit restrictions under ERISA section 206(g) and Code section 436 must be credited toward minimum funding requirements for a particular plan year.

Line 19. Discounted Employer Contributions. Top Employer contributions reported in line 18 that were made on a date other than the valuation date must be adjusted to reflect interest for the time period between the valuation date for the plan year to which the contribution is allocated and the date the contribution was made. In general, adjust each contribution using the effective interest rate for the plan year to which the contribution is allocated.

Allocate the interest-adjusted employer contributions to lines 19a, 19b, and 19c to report the purpose for which they were made (as described below).

Attach a schedule showing the dates and amounts of individual contributions, the year to which the contributions (or the portion of individual contributions) are applied, the applicable effective interest rate (including increased rate for late quarterly installments, where applicable), and the interest-adjusted contribution. It is not necessary to include interest-adjusted contributions allocated toward the minimum required contribution for the current year (reported in line 19c) in this schedule, unless any of those contributions represent late quarterly installments. However, if any of the contributions reported in line 19c represent late quarterly installments, include all contributions reported in line 19c on this schedule. Label the attachment "Schedule SB, line 19 - Discounted Employer Contributions."

Special note for small plans with valuation dates after the beginning of the plan year. Top If the valuation date is after the beginning of the plan year and contributions for the current year were made during the plan year but before the valuation date, such contributions are increased with interest to the valuation date using the effective interest rate for the current plan year. These contributions and the interest calculated as described in the preceding sentence are excluded from the value of assets reported in lines 2a and 2b.

Interest adjustment for contributions representing late required quarterly installments - installments due after the valuation date. Top If the full amount of a required installment due after the valuation date for the current plan year is not paid by the due date for that installment, increase the effective interest rate used to discount the contribution by 5 percentage points for the period between the due date for the required installment and the date on which the payment is made. If all or a portion of the late required quarterly installment is due to a liquidity shortfall, the increased interest rate is used for a period of time corresponding to the period between the due date for the installment and the end of that quarter, regardless of when the contribution is actually paid.

Line 19a. Contributions Allocated Toward Unpaid Minimum Required Contribution from Prior Plan Years. Top Code section 4971(c)(4)(B) provides that any payment to or under a plan for any plan year shall be allocated first to unpaid minimum required contributions for all preceding plan years on a first-in, first-out basis and then to the minimum required contribution for the current plan year. Report any contributions from line 18 that are allocated toward unpaid minimum required contributions from prior plan years, discounted for interest from the date the contribution was made to the valuation date for the plan year for which the contribution was originally required as described above. Increase the effective interest rate for the applicable plan year by 5 percentage points for any portion of the unpaid minimum required contribution that represents a late quarterly installment, for the period between the due date for the installment and the date of payment. Reflect the increased interest rate for any portion of the unpaid minimum required contribution that represents a late liquidity shortfall installment, for the period corresponding to the time between the date the installment was due and the end of the quarter during which it was due. The amount reported in line 19a cannot be larger than the amount reported in line 28.

For the purpose of allocating contribution amounts to unpaid minimum required contributions, any unpaid minimum required contribution attributable to an accumulated funding deficiency at the end of the last plan year before ERISA section 303 or Code section 430 applied to the plan (the "pre-effective plan year") is treated as a single contribution due on the last day of the pre-effective plan year (without separately identifying any portion of the accumulated funding deficiency attributable to late quarterly installments or late liquidity shortfall installments), and the associated effective interest rate is deemed to be the valuation interest rate for the pre-effective plan year.

Line 19b. Contributions Made To Avoid Benefit Restrictions. Top Include in this category contributions made to avoid benefit restrictions under ERISA section 206(g) and Code section 436. Adjust each contribution for interest from the date the contribution was made to the valuation date as described above.

Line 19c. Contributions Allocated Toward Minimum Required Contribution for Current Year. Top Include in this category contributions (including any contributions made in excess of the minimum required contribution) that are not included in line 19a or 19b. Adjust each contribution for interest from the date the contribution was made to the valuation date as described above.

Line 20. Quarterly Contributions and Liquidity Shortfalls. Top

Line 20a. Did the Plan Have a Funding Shortfall for the Prior Plan Year? Top In accordance with ERISA section 303(j)(3) and Code section 430(j)(3), only plans that have a funding shortfall for the preceding plan year are subject to an accelerated quarterly contribution schedule. For this purpose, a plan is considered to have a funding shortfall for the prior year if the funding target reported on line 3d, column (2) is greater than the actuarial value of assets reported on line 2b, reduced by the sum of the funding standard carryover balance and prefunding balance reported on line 13, columns (a) and (b), with all figures taken from the prior year's Schedule SB. However, see Code section 430(f)(4)(B)(ii) and ERISA section 303(f)(4)(B)(ii) for special rules in the case of a binding agreement with the PBGC providing that all or a portion of the funding standard carryover balance and/or prefunding balance is not available to offset the minimum required contribution for the prior plan year.

Please note that a plan may be considered to have a funding shortfall for this purpose even if it is exempt from establishing a shortfall amortization base under the provisions of ERISA section 303(c)(5) and Code section 430(c)(5), as amended by WRERA.

Line 20b. Top If line 20a is "No" (i.e., if the plan did not have a funding shortfall in the prior plan year), the plan is not subject to the quarterly contribution rules, and this line should not be completed. If line 20a is "Yes," check the "Yes" box on line 20b if required installments for the current plan year were made in a timely manner; otherwise, check "No."

Line 20c. Top If line 20a is "No," or the plan had 100 or fewer participants on every day of the preceding plan year (as defined for line F), the plan is not subject to the liquidity requirement of ERISA section 303(j)(4) and Code section 430(j)(4) and this line should not be completed. Attach a certification by the enrolled actuary if the special rule for nonrecurring circumstances is used, and label the certification "Schedule SB, line 20c - Liquidity Requirement Certification." (See ERISA section 303(j)(4)(E)(ii)(II) and Code section 430(j)(4)(E)(ii)(II).)

If the plan is subject to the liquidity requirement and has a liquidity shortfall for any quarter of the plan year (see ERISA section 303(j)(4)(E) and Code section 430(j)(4)(E)), enter the amount of the liquidity shortfall for each such quarter. If the plan was subject to the liquidity requirement but did not have a liquidity shortfall, enter zero. File Form 5330, Return of Excise Taxes Related to Employee Benefit Plans, with the IRS to pay the 10% excise tax(es) if there is a failure to pay any liquidity shortfall by the required due date, unless a waiver of the 10% tax under Code section 4971(f) has been granted.

Specific Instructions for Part V - Assumptions Used To Determine Funding Target and Target Normal Cost Return to top

Line 21. Discount Rate. Top

Line 21a. Top Enter the three segment rates used to calculate the funding target as provided under ERISA section 303(h)(2)(C) and Code section 430(h)(2)(C) and as published by the IRS, unless the plan sponsor has elected to use the full yield curve. Enter rates after application of the transition rule provided under ERISA section 303(h)(2)(G) and Code section 430(h)(2)(G) unless the sponsor has elected to not have the transition rule apply. If the sponsor has elected to use the full yield curve, check the "N/A, full yield curve used" box.

Special rules for airlines using 10-year amortization period under section 402(a)(2) of PPA (as amended). Top Enter the information described above to reflect the discount rates used to determine the target normal cost in accordance with Code section 430(h)(2) and ERISA section 303(h)(2). Do not enter the special 8.25% interest rate used to determine the funding target under section 402(a)(2) of the PPA.

Line 21b. Top ERISA section 303(h)(2)(E) and Code section 430(h)(2)(E) provide that the segment rate(s) used to measure the funding target are those published by Treasury for the month that includes the valuation date (based on the average of the monthly corporate bond yield curves for the 24-month period ending with the month preceding that month). Alternatively, at the election of the plan sponsor, the segment rate(s) used to measure the funding target may be those published by Treasury for any of the four months that precede the month that includes the valuation date. The IRS has indicated that it will not challenge the use of the monthly yield curve based on interest rates published by the IRS for the month including the valuation date or any one of the immediately preceding four months, for plan years beginning in 2008 and 2009.

Enter the applicable month to indicate which segment rates were used to determine the funding target. Enter "0" if the rates used to determine the funding target were published for the month that includes the valuation date. Enter "1" if the rates were published for the month immediately preceding the month that includes the valuation date, "2" for the second preceding month, and "3" or "4," respectively, for the third or fourth preceding months. For example, if the valuation date is January 1 and the funding target was determined based on rates published for November, enter "2."

Note. The plan sponsor's election under ERISA section 303(h)(2) or Code section 430(h)(2) regarding the interest rates used (election to use yield curve, election of applicable month other than the default month, or election not to use transition rules in ERISA section 303(h)(2)(G) and Code section 430(h)(2)(G)) generally may not be changed unless the plan sponsor obtains approval from the IRS. However, see the regulations for circumstances in which a change to an interest rate election may be made for the 2009 plan year without obtaining specific prior approval from the IRS.

Line 22. Weighted Average Retirement Age. Top Enter the weighted average retirement age for active participants. If the plan is in at-risk status, enter the weighted average retirement age as if the plan were not in at-risk status. If each participant is assumed to retire at his/her normal retirement age, enter the age specified in the plan as normal retirement age. If the normal retirement age differs for individual participants, enter the age that is the weighted average normal retirement age; do not enter "NRA." Otherwise, enter the assumed retirement age. If the valuation uses rates of retirement at various ages, enter the nearest whole age that is the weighted average retirement age.

On an attachment to Schedule SB, list the rate of retirement at each age and describe the methodology used to compute the weighted average retirement age, including a description of the weight applied at each potential retirement age, and label the attachment "Schedule SB, line 22 - Description of Weighted Average Retirement Age."

Line 23. Mortality Table. Top Mortality tables described in Code section 430(h)(3), ERISA section 303(h)(3), and section 1.430(h)(3)-1 of the Treasury Regulations as published by the IRS must be used to determine the funding target and target normal cost for non-disabled participants and may be used to determine the funding target and target normal cost for disabled participants, unless the IRS has approved (or was deemed to have approved) the use of a substitute mortality table reflecting the plan's actual experience and projected trends in general mortality experience. Standard mortality tables must be either applied on a generational basis, or the tables must be updated to reflect the static tables published for the year in which the valuation date occurs. Substitute mortality tables must be applied in accordance with the terms of the IRS ruling letter.

Separate standard mortality tables were published by the IRS for annuitants (rates applying for periods when a participant is assumed to receive a benefit under the plan) and nonannuitants (rates applying to periods before a participant is assumed to receive a benefit under the plan). If a plan has 500 or fewer participants as of the valuation date for the current plan year as reported in line 3d, column (1), the plan sponsor can elect to use the combined mortality tables published by the IRS, which reflect combined rates for both annuitants and nonannuitants.

Check the applicable box to indicate which mortality tables was used to determine the funding target and target normal cost. If one mortality table was used for certain populations within the plan and a different mortality table was used for other populations, check the box for the table that applied to the largest population. If more than one mortality table was used, attach a statement describing the mortality table used for each population and the size of the population. Label the attachement "Schedule SB, line 23 - Information on Use of Multiple Mortality Tables."

Attach a statement of actuarial assumptions and funding methods used to calculate the Schedule SB entries and label the statement "Schedule SB, Part V - Statement of Actuarial Assumptions/Methods." The statement must describe all non-prescribed actuarial assumptions (e.g., retirement, withdrawal rates) used to determine the funding target and target normal cost, including the assumption as to the frequency with which participants are assumed to elect each optional form of benefit (including lump sum distributions), whether mortality tables are applied on a static or generational basis, whether combined mortality tables are used instead of separate annuitant and nonannuitant mortality tables (for plans with 500 or fewer participants as of the valuation date), and (for target normal cost) expected increases in compensation. For applicable defined benefit plans under ERISA section 203(f)(3) and Code section 411(a)(13)(C) (e.g., cash balance plans) the statement must include the assumptions used to convert balances to annuities. In addition, the statement must describe the method for determining the actuarial value of assets and any other aspects of the funding method for determining the Schedule SB entries that are not prescribed by law.

Also attach a summary of the principal eligibility and benefit provisions on which the valuation was based, including the status of the plan (e.g., frozen eligibility, service/pay, or benefits), optional forms of benefits, special plan provisions, including those that apply only to a subgroup of employees (e.g., those with imputed service), supplemental benefits, and identification of benefits not included in the valuation, a description of any significant events that occurred during the year, a summary of any changes in principal eligibility or benefit provisions since the last valuation, a description (or reasonably representative sample) of plan early retirement reduction factors and optional form conversion factors. Label the summary "Schedule SB, Part V - Summary of Plan Provisions."

Also, include any other information needed to disclose the actuarial position of the plan fully and fairly.

Specific Instructions for Part VI - Miscellaneous Items Return to top

Line 24. Change in Non-Prescribed Actuarial Assumptions. Top If a change has been made in the non-prescribed actuarial assumptions for the current plan year, check "Yes." If the only assumption changes are statutorily required changes in the discount or mortality rates, or changes required for plans in at-risk status, check "No." Include as an attachment a description of any change in non-prescribed actuarial assumptions and justifications for any such change. (See section 103(d) of ERISA.) Label the attachment "Schedule SB, line 24 - Change in Actuarial Assumptions."

Generally, if the "Yes" box is checked and the non-prescribed assumptions have been changed in a way that decreases the funding shortfall for the current plan year, approval for such a change may be required. However, approval is not required with respect to any actuarial assumptions that are adopted for the first plan year for which Code section 430 and ERISA section 303 apply to the plan, and that are not inconsistent with the requirements of Code section 430.

Line 25. Change in Funding Method. Top If a change in the funding method has been made for the current plan year, check "Yes." For this purpose, "funding method" refers to not only the overall method used by the plan, but also each specific method of computation used in applying the overall method. Accordingly, method changes include modifications such as a change in the method for calculating the actuarial value of assets or a change in the valuation date (not an exclusive list). In general, any changes in a plan's funding methods must be approved by the IRS. However, see the regulations for circumstances in which a chnage in funding method may be made for the 2009 plan year without obtaining approval from the IRS.

Include, as an attachment, a description of the change. Label the attachment "Schedule SB, line 25 - Change in Method."

Note. The plan sponsor's agreement to any change in funding method should be reported on line 8 of Schedule R (Form 5500).

Line 26. Schedule of Active Participant Data. Top Check "Yes" only if (a) the plan is covered by Title IV of ERISA and (b) the plan has active participants.

If line 26 is "Yes," attach a schedule of the active plan participant data used in the valuation for this plan year. Use the format shown below and label the schedule "Schedule SB, line 26 - Schedule of Active Participant Data."

Expand this schedule by adding columns after the "5 to 9" column and before the "40 & up" column for active participants with total years of credited service in the following ranges: 10 to 14; 15 to 19; 20 to 24; 25 to 29; 30 to 34; and 35 to 39. For each column, enter the number of active participants with the specified number of years of credited service divided according to age group. For participants with partial years of credited service, round the total number of years of credited service to the next lower whole number. Years of credited service are the years credited under the plan's benefit formula.

Plans reporting 1,000 or more active participants on line 3c(3), column 1, must also provide average compensation data. For each grouping, enter the average compensation of the active participants in that group. For this purpose, compensation is the compensation taken into account for each participant under the plan's benefit formula, limited to the amount defined under section 401(a)(17) of the Code. Do not enter the average compensation in any grouping that contains fewer than 20 participants.

In the case of a plan under which benefits are primarily pay-related and under which no future accruals are granted (i.e., a "hard-frozen" plan as defined in the instructions for plan characteristic "1I" applicable to line 8a of the Form 5500), report the average annual accrued benefit in lieu of average compensation. Include a note on the scatter indicating that the plan is "hard frozen" and the average accrued benefits are in lieu of compensation.

Cash balance plans (or any plans using characteristic code 1C on line 8a of Form 5500) reporting 1,000 or more active participants on line 3c(3), column 1, must also provide average cash balance account data, regardless of whether all active participants have cash balance accounts. For each age/service bin, enter the average cash balance account of the active participants in that bin. Do not enter the average cash balance account in any age/service bin that contains fewer than 20 active participants.

General Rule. In general, data to be shown in each age/service bin includes:
  1. the number of active participants in the age/service bin,
  2. the average compensation of the active participants in the age/service bin, and
  3. the average cash balance account of the active participants in the age/service bin, using $0 for anyone who has no cash balance account-based benefit.

If the accrued benefit is the greater of a cash balance benefit or some other benefit, average in only the cash balance account. If the accrued benefit is the sum of a cash balance account benefit and some other benefit, average in only the cash balance account. For both the average compensation and the average cash balance account, do not enter an amount for age/service bins with fewer than 20 active participants.

In lieu of the above, two alternatives are provided for showing compensation and cash balance accounts. Each alternative provides for two age/service scatters (one showing compensation and one showing cash balance accounts) as follows:

Alternative A:

Alternative B:

In general, information should be determined as of the valuation date. Average cash balance accounts may be determined as of either:
  1. the valuation date or
  2. the day immediately preceding the valuation date.

Average cash balance accounts that are offset by amounts from another plan may be reported either as amounts prior to taking into account the offset, or as amounts after taking into account the offset. Do not report the offset amount. For this or any other unusual or unique situation, the attachment should include an explanation of what is being provided.

If the plan is a multiple-employer plan, complete one or more schedules of active-participant data in a manner consistent with the computations for the funding requirements reported in Part VIII. For example, if the funding requirements are computed as if each participating employer maintained a separate plan, attach a separate "Schedule SB, line 26 - Schedule of Active Participant Data" for each participating employer in the multiple-employer plan.

Schedule SB, Line 26 - Schedule of Active Participant Data
Attained
Age		 YEARS OF CREDITED SERVICE //
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\
//
\\		  
Under 1 1 to 4 5 to 9 40 & up
No. Average
Comp.|Cash Bal.		 No. Average
Comp.|Cash Bal.		 No. Average
Comp.|Cash Bal.		 No. Average
Comp.|Cash Bal.
Under 25

25 to 29

30 to 34

35 to 39

40 to 44

45 to 49

50 to 54

55 to 59

60 to 64

65 to 69

70 & up		    

Line 27. Alternative Funding Rules. Top If one of the alternative funding rules was used for this plan year, enter the appropriate code from the table below and follow the special instructions applicable to that code, including completion of any required attachments.

Code Alternative Funding Rule
1 Certain multiple-employer plans maintained by rural cooperatives or related organizations as described in section 104 of PPA
2 Temporary relief for certain PBGC settlement plans described in section 105 of PPA
3 Certain plans maintained by government contractors as described in section 106 of PPA
4 Plans with binding agreements with PBGC to maintain prefunding and/or funding standard carryover balances described in Code section 430(f)(4)(B)(ii) and ERISA section 303(f)(4)(B)(ii)
5 Airlines using 10-year amortization period for initial post-PPA shortfall amortization base under section 402(a)(2) of PPA (as amended)
6 Alternative 17-year funding schedule for airlines with frozen plans under section 402(a)(1) of PPA
7 Interstate transit company described in section 115 of PPA

Plans entitled to delayed effective dates for PPA funding rules (codes 1, 2, and 3). Top For plan years before Code section 430 and ERISA section 303 apply to the plan, complete only the following lines on Schedule SB:

Also, report other information for the current plan year using a 2007 Schedule B (Form 5500). Label this attachment "2009 Schedule SB, line 27 - Actuarial Information Based on Pre-PPA Funding Rules." Complete all items, and attach the form and all applicable attachments to the Schedule SB. Note that under PPA, the third segment rate determined under Code section 430(h)(2)(C)(iii) and ERISA section 303(h)(2)(C)(iii) is substituted for the current liability interest rate under Code section 412(b)(5)(B) and ERISA section 302(b)(5)(B) (as in effect before PPA).

Plans with binding agreements with the PBGC to maintain prefunding and/or carryover balances (code 4). Top Complete entire Schedule SB and attachments as outlined in these instructions. In addition, report on an attachment the amount subject to the binding agreement with the PBGC, reported separately for the funding standard carryover balance and prefunding balance. Label the attachment "Schedule SB, line 27 - Balances Subject to Binding Agreement with PBGC."

Airline using 10-year amortization period for initial post-PPA shortfall amortization base (code 5). Top Complete the entire Schedule SB and attachments as outlined in these instructions. Under section 402(a)(2) of PPA (as amended), the funding target for plans funded using this alternative is determined using an interest rate of 8.25% for each of the 10 years during the amortization period instead of the interest rates otherwise required under Code section 430(h)(2) and ERISA section 303(h)(2). However, this special 8.25% interest rate does not apply for other purposes, including the calculation of target normal cost or the amortization of the funding shortfall.

Alternative 17-year funding schedule for airlines with frozen plans (code 6). Top Complete the following lines on Schedule SB and provide associated attachments:

For this purpose, disregard the special funding rules under section 402(e) of PPA except for the information reported on the following lines:

Also, attach a worksheet showing the information below, determined in accordance with section 402(e) of the PPA. Label this worksheet "Schedule SB, line 27 - Alternative 17-Year Funding Schedule for Airlines."

Interstate transit company (code 7). Top Complete the entire Schedule SB, reflecting the modifications to the otherwise-required funding rules under section 115(b) of PPA, and disregarding the attachment required for plans reporting the use of the substitute mortality table in line 23.

Specific Instructions for Part VII - Reconciliation of Unpaid Minimum Required Contributions for Prior Years Return to top

Line 28. Unpaid Minimum Required Contributions for Prior Years. Top Enter the total amount of any unpaid minimum required contributions for all years from line 40 of the Schedule SB for the prior plan year.

If this is the first year that the plan is subject to the minimum funding requirements of ERISA section 303 or Code section 430, enter the amount of any accumulated funding deficiency at the end of the prior year (the pre-effective plan year). This is the amount reported on line 9p of the 2007 Schedule B form that was submitted as an attachment to the Schedule SB for the pre-effective plan year.

Line 29. Employer Contributions Allocated Toward Unpaid Minimum Required Contributions from Prior Years. Top Enter the total amount of discounted contributions made for the current plan year allocated toward unpaid minimum required contributions from prior years as reported in line 19a.

Line 30. Remaining Unpaid Minimum Required Contributions. Top Enter the amount in line 28 minus the amount in line 29.

Specific Instructions for Part VIII - Minimum Required Contribution for Current Year Return to top

Line 31. Target Normal Cost, Adjusted if Applicable. Top In general, enter the target normal cost as reported in line 6. However, if the minimum contribution is determined under Code section 430(a)(2) or ERISA section 303(a)(2) (relating to plans with excess assets), enter the amount of the minimum required contribution. For this purpose, excess assets are determined as the value of assets reported on line 2b reduced by the funding standard carryover balance reported in line 13, columns (a) and (b), minus the funding target reported in line 3d, column (2) (but not less than zero). If the plan's valuation date is not the first day of the plan year, adjust the amount reported in line 13, columns (a) and (b), for interest at the effective interest rate for the period between the beginning of the plan year and the valuation date, before subtracting those amoutns from the value of assets reported on line 2b.

Line 32. Amortization Installments. Top

Line 32a. Shortfall Amortization Bases and Amortization Installments. Top Outstanding balance - If the plan's funding shortfall (determined under Code section 430(c)(4) and ERISA section 303(c)(4)) is zero, all amortization bases and related installments are considered fully amortized. In this case, enter zero. Otherwise, enter the sum of the outstanding balances of all shortfall amortization bases (including any new shortfall amortization base established for the current plan year). The outstanding balance for each amortization base established in past years is equal to the present value as of the valuation date of any remaining amortization installments for each base (including the amortization installment for the current plan year), using the interest rates reported on line 21.

A plan is generally exempt from the requirement to establish a new shortfall amortization base for the current year if the funding target reported in line 3d, column (2), is less than or equal to the adjusted value of assets. However, if the plan existed during 2007 and was not subject to Code section 412(l) or ERISA section 302(d) for the last plan year beginning before the plan was subject to ERISA section 303 or Code section 430 (the "pre-effective plan year"), only 94% of the funding target is taken into account for this calculation for plan years beginning in 2009.

For the purpose of determining whether a plan is exempt from the requirement to establish a new shortfall amortization base for the current plan year, the adjusted value of assets is the amount reported on line 2b, reduced by the full value of the prefunding balance reported on line 13, column (b) if (and only if) the plan sponsor has elected to use any portion of the prefunding balance to offset the minimum required contribution for the current plan year, as reported on line 35. If the plan's valuation date is not the first day of the plan year, adjust the amount reported in line 13, column (b) for interest for the period between the beginning of the plan year and the valuation date (using the effective interest rate for the current plan year) before subtracting it from the value of assets reported on line 2b. The assets are not reduced by the amount of any funding standard carryover balance for this calculation regardless of whether any portion of the funding standard carryover balance is used to offset the minimum required contribution for the plan year.

If the plan is not exempt from the requirement to establish a new shortfall amortization base for the current plan year, the amount of that base is equal to the difference between the funding shortfall as of the valuation date (determined under Code section 430(c)(4) and ERISA section 303(c)(4)) and the sum of any outstanding balances of any previously established shortfall and waiver amortization bases. The new shortfall amortization base may be either greater than or less than zero.

For the purpose of determining the amount of any new shortfall amortization base, the funding shortfall is generally equal to the amount of the funding target reported on line 3d, column (2), minus the adjusted value of assets, but not less than zero. However, if the plan existed during 2007 and was not subject to Code section 412(l) or ERISA section 302(d) for the pre-effective plan year, only 94% of the funding target is taken into account for this calculation for plan years beginning in 2009. The adjusted value of assets is generally the amount reported on line 2b, reduced by the sum of the funding standard carryover balance and the prefunding balance reported on line 13, columns (a) and (b). If the plan's valuation date is not the first day of the plan year, adjust the amounts reported on line 13, columns (a) and (b), for interest for the period between the beginning of the plan year and the valuation date (using the effective interest rate for the current plan year) before subtracting from the value of assets reported on line 2b. However, see Code section 430(f)(4)(B)(ii) and ERISA section 303(f)(4)(B)(ii) for special rules in the case of a binding agreement with the PBGC providing that all or a portion of the funding standard carryover balance and/or prefunding balance is not available to offset the minimum required contribution for the plan year.

Shortfall amortization installment - Enter the sum of:
  1. Any shortfall amortization installments that were established to amortize shortfall amortization bases established in prior years, excluding amortization installments for bases that have been or are deemed to be fully amortized, and
  2. The shortfall amortization installment that corresponds to any new shortfall amortization base established for the current plan year. This amount is the level amortization payment that will amortize the new shortfall amortization base over 7 annual payments, using the same segment interest rates or rates from the full yield curve used to calculate the target normal cost for the current plan year.

Note. Shortfall amortization installments for a given shortfall amortization base are not re-determined from year to year regardless of any changes in interest rates.

Line 32b. Waiver Amortization Bases and Amortization Installments. Top Outstanding balance - If the plan's funding shortfall (determined under Code section 430(c)(4) and ERISA section 303(c)(4)) is zero, all waiver amortization bases and related installments are considered fully amortized. In this case, enter zero. Otherwise, enter the present value as of the valuation date of all remaining waiver amortization installments (including any installment for the current plan year), using the interest rates reported on line 21. Do not include any new waiver amortization base established for a waiver of minimum funding requirements for the current plan year.

Waiver amortization installments - Enter the sum of any remaining waiver amortization installments that were established to amortize any waiver amortization bases for prior plan years, unless such bases have been or are deemed to be fully amortized. Do not include an amortization installment for any new waiver amortization base established for a waiver of minimum funding requirements for the current plan year.

Note. If a waiver of minimum funding requirements has been granted for the current plan year, a waiver amortization base is established as of the valuation date for the current plan year equal to the amount of the funding waiver reported in line 33. The waiver amortization installment that corresponds to any waiver amortization base established for the current year is the level amortization payment that will amortize the new waiver amortization base over 5 annual payments, using the same segment interest rates or rates from the full yield curve reported on line 21 for the current plan year, but with the first payment due on the valuation date for the following plan year. The amount of the waiver amortization base and the waiver amortization installments for this base are not reported in line 32b for the year in which they are established. Rather, these are included in the entries for line 32b on the Schedule SB for the following plan year.

Note. Waiver amortization installments (including the waiver amortization installments of any waiver amortization base established for the prior plan year) are not re-determined from year to year regardless of any changes in interest rates.

Required attachment. If there are any shortfall or waiver amortization bases, include as an attachment a listing of all bases (other than a base established for a funding waiver for the current plan year) showing for each base:
  1. The type of base (shortfall or waiver),
  2. The present value of any remaining installments (including the installment for the current plan year),
  3. The valuation date as of which the base was established,
  4. The number of years remaining in the amortization period, and
  5. The amortization installment.

If the base is negative (i.e., a "gain base"), show amounts in parentheses or with a negative sign in front of them. All amounts must be calculated as of the valuation date for the plan year. Label the schedule "Schedule SB, line 32 - Schedule of Amortization Bases."

Line 33. Funding Waiver. Top If a waiver of minimum funding requirements has been approved for the current plan year, enter the date of the ruling letter granting the approval and the waived amount (reported as of the valuation date) in the spaces provided. If a waiver is pending, do not complete this line. If a pending waiver is granted after Form 5500 is filed, file an amended Form 5500 with an amended Schedule SB.

Line 34. Total Funding Requirement Before Reflecting Carryover/Prefunding Balances. Top Enter the sum of line 31 and the amortization installments reported in lines 32a and 32b, reduced by line 33. (Result cannot be less than zero.)

Line 35. Carryover Balance Used to Offset Funding Requirement. Top If the percentage reported in line 16 is at least 80%, and the plan has a funding standard carryover balance (as reported in line 13, column (a)), the plan sponsor may elect to credit such balance against the minimum funding requirement. Enter the amount of any balance to be used for this purpose in the applicable column of line 35, and enter the total in the column headed "Total balance." No portion of the prefunding balance can be used for this purpose unless the full amount of any remaining funding standard carryover balance (line 13, column (a)) is used. The amounts entered in line 35 cannot be larger than the corresponding amounts on line 13 (unless the plan's valuation date is not the first day of the plan year, as discussed below), or the corresponding amount on line 34.

Special rule for late election to apply balances to quarterly installments. Top If an election was made to use the funding standard carryover balance or the prefunding balance to offset the amount of a required quarterly installment, but the election was made after the due date of the installment, the amount reported on line 35 is determined by discounting the amount used to satisfy the installment from the date of the election to the due date of the required installment at a rate of interest equal to the effective interest rate plus 5 percentage points, and then further discounting the amount to the valuation date at the effective interest rate.

If the plan's valuation date is not the first day of the plan year, adjust the funding standard carryover balance and prefunding balance for interest between the beginning of the plan year and the valuation date using the effective interest rate for the current plan year.

Line 36. Additional Cash Requirement. Top Enter the amount in line 34 minus the amount in the "Total Balance" column in line 35. (The result cannot be less than zero.) This represents the contribution needed to satisfy the minimum funding requirement for the current year, adjusted for interest to the valuation date.

Line 37. Contributions Allocated Toward Minimum Required Contribution for Current Year, Adjusted to Valuation Date. Top Enter the amount reported in line 19c.

Line 38. Interest-Adjusted Excess Contributions for Current Year. Top Report the interest-adjusted excess contributions as of the valuation date. This amount (plus interest, if applicable) is the maximum amount by which the plan sponsor may elect to increase the prefunding balance. Do not enter a negative number.

Line 39. Unpaid Minimum Required Contribution for Current Year. Top If line 37 is less than line 36, enter the amount by which line 36 exceeds line 37. Otherwise, enter "0."

Line 40. Unpaid Minimum Required Contribution for All Years. Top Enter the sum of the remaining unpaid minimum required contributions from line 30 and the unpaid minimum required contribution for the current year from line 39.