Save time with our cheat sheets, fact sheets, checklists & books!

February 16, 2009

Omnibus Budget Reconciliation Act (OBRA )

Your Guide



There are several versions of OBRA

  • OBRA 90 increased the employer reversion penalty from 15 to 50%
  • OBRA 93 instituted the compensation cap
  • Section 407(d)(9) of ERISA, as added by section 9345(a)(2) of OBRA ’87, provides that, for purposes of section 407, an arrangement which consists of a defined benefit plan and an individual account plan shall be treated as one plan if the benefits of such arrangement are taken into account in determining the benefits payable under such defined benefit plan.

Referring Cite  ,

Additional Helpful Information

  • Section 407(d)(3)(C) of ERISA, was added by section 9345(a)(1) of OBRA ’87,  and provides that the term “eligible individual account plan” does not include any individual account plan the benefits of which are taken into account in determining the benefits payable to a participant under any defined benefit plan.
  • Section 9345(a)(3) of OBRA ’87 provides that sections 407(d)(3)(C) and 407(d)(9) shall apply with respect to arrangements established after December 17, 1987. Thus, sections 407(d)(3)(C) and 407(d)(9) of ERISA do not apply to floor-offset arrangements established on or before December 17, 1987.

Keep Learning

Domestic abuse distribution

A domestic abuse distribution is one that is made to domestic abuse victim, during the 1-year period beginning on any date on which the individual

Eligible retirement plan

The term “eligible retirement plan”, means a retirement plan to which a rollover contribution can be made. These are: (i)an individual retirement account described in

Qualified See-Through Trust beneficiary

Definition A qualified trust beneficiary is a trust that satisfies the requirements so as to be treated as a designated beneficiary.   For retirement accounts inherited

Saver’s Credit

Definition Also known as the Saver’s Tax Credit: Nonrefundable tax credit available to eligible individuals who make contributions to their retirement account. The saver’s credit

Be among the first to know when

IRA Rules