U.S. qualified and U.S. public modes
ProVal can handle automatically many calculations with respect to the U. S. Internal Revenue Code (IRC) section 415(b) benefit limits (the annual benefit, or dollar, limit and the 100% of average compensation, or salary, limit). ProVal applies the 415(b) limits separately to the benefits at commencement for each Benefit Definition contained in the Plan Definition. See the Technical Reference article entitled U.S. Internal Revenue Service Section 415 Limits for details.
Clicking the Adjustments button of the Benefit Definition dialog box leads to the 415(b) Maximum Benefit Limit dialog box, which provides parameters to adjust the dollar limit for that particular benefit’s payment form and plan reduction factors. The Regulatory Data topic of Valuation Assumptions contains additional specifications, applicable to all Benefit Definitions within a Plan Definition, for adjusting the dollar limit for early or late commencement or for less than 10 years of participation, for computing the salary limit, or to indicate application of the $10,000 exemption.
ProVal compares the amount determined by the Benefit formula to the single life annuity limit at commencement. If the benefit is to be paid as a single life annuity or as a qualified joint and survivor annuity, this is appropriate. If not, then you need to specify the Payment form adjustments to convert the single life annuity limit to the limit for the appropriate payment form (i.e., the type of ProVal payment form selected for this Benefit Definition). For technical guidance on how to convert the limit, refer to Internal Revenue Service pronouncements, including Revenue Ruling 98-1 and Regulation 1.415(b)-1. You may tell ProVal to multiply the life annuity limit by the value in a benefit component Table, by a Constant value to apply at all decrement dates for all active records, or by both. For example, if the Normal form parameter indicates a certain and life annuity, the referenced Benefit Component Table should contain values for conversion of the life annuity to the certain and life annuity at each decrement age. Similarly, if the Normal form parameter indicates a lump sum, the referenced table should contain present values at each decrement age of the underlying life annuity form. (See Table Interface for details about constructing tables and entering their values.) Note that the Normal form parameter of the Benefit Definition determines the assumed payment commencement age that ProVal will use for adjusting the dollar limit for early or late commencement. (If an Optional form is defined, the benefit amount after application of the 415 limit is converted to the optional payment form.)
To choose a table to convert the limit, select from the list of tables contained in the current Project or click the 
button to access the Benefit Component Table library and create new tables or modify existing ones. Specify if the table values should be determined using a Table look up based on age at commencement or decrement.
To adjust the 415 dollar limit for early commencement, specify the Plan Reduction Factors to compare to the statutory factors calculated with the actuarial assumptions indicated under the Regulatory Data topic of Valuation Assumptions. The plan reduction factors will be normalized to age 62 before comparing to the statutory factors. In other words, the value at commencement will be divided by the value at age 62 and the lesser of this factor and the statutory factor will be used to reduce the 415(b) dollar limit. If the table of plan reduction factors is based on service, select the service from among the database fields and Service Definitions unhidden in the current Project. The button accesses the Service Definition library, allowing you to modify an existing Service Definition or create a new one.
According to the 2014 Gray Book, Question 32, the accrued benefit at normal retirement age is limited by the 415(b) maximum benefit limit. The plan benefit payable at commencement is the accrued benefit (limited by 415(b)) reduced for early retirement and the selected optional form, and then limited by the 415(b) limit at commencement age. Effectively, the 415(b) limits are applied at two ages. In ProVal, to limit the accrued benefit payable at normal retirement age, use #MAXBEN in your benefit formula to check the benefit before application of any early retirement factors. For example, you might code your benefit definition to look like this:
It may be preferable to use #MAXBEN and not check the Apply 415(b) maximum benefit limit box if the Normal form is a deferred lump sum. ProVal assumes that the commencement age is the deferral age (at which the lump sum is paid) and reduces the dollar limit accordingly. Similarly, for example, if the Normal form is a lump sum type without deferral, ProVal assumes that the commencement age is the decrement age and reduces the dollar limit accordingly. Since the 415(b) limit should be reduced to commencement age instead of at decrement age, uncheck the Apply 415(b) maximum limit box and use #MAXBEN in the Benefit formula of your Benefit Definition.
It may also be preferable to use #MAXBEN and not check the Apply 415(b) maximum benefit limit box if the Contingency initiating the benefit is death and the Normal form is a lump sum type representing an assumed election by the beneficiary (to take a lump sum instead of the spousal annuity), particularly if a lump sum factor type of Benefit Formula Component is used in the Benefit formula (instead of a table type) for the present value of the underlying annuity. In this situation, presumably, the lump sum factor coding indicates that beneficiary mortality, not member mortality, underlies the lump sum annuity value, but ProVal looks up table values according to the member’s age and sex, not the beneficiary’s. Hence, although you did not need to create a Benefit Component Table for use in the Benefit formula, with values reversed for the sexes and shifted according to the assumed husband / wife age difference, you would need to create such a table for selection in the 415(b) Maximum Benefit Limit dialog box. Probably, instead of checking the Apply 415(b) maximum benefit limit box, the simpler alternative is to use #MIN in the Benefit formula, where the lump sum factor component can be used to limit the amount of lump sum payment to the product of the present value of a spousal annuity and the 415(b) annuity form benefit limit (coded using #MAXBEN).