Defined benefit plan-contemplating retirement

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Andy is a participant in a qualified defined benefit plan and has been covered by this plan for 25 years. He is contemplating retirement and he is aware that the plan allows for permitted disparity using the excess method. Andy's current wages are $150,000. Since permitted disparity develops two benefit calculations. the base funding formula is .8% per year of service multiplied by final salary and an additional benefit of .6% per year of service multiplied by his income that exceeds the compensation limit of $117,000. Under this formula, what would be his annual benefit if he retired in 2014?

Reference no: EM13845492

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