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PBGC Pension Benefit Guaranty Corporation 

Protecting America's Pensions 1200 K Street. N. W., Washington, D.C. 20005-4026 

February 24, 2009 

Re: I; Case 202002; Better Business Forms, Inc. Pension 

Plan (the uBBF Plan" or the "Plan") 

Dea~ '--------~ 

This Appeals Board decision responds to your appeal of PBGe's February 25, 

2008 determination of your PBGC benefit under the BBF Plan. For the reasons we 

state below, we changed PBGC's determination by finding that PBGC should offset your 

monthly benefit by the annuity equivalent of the $3,867.62 lump sum that you received 

on December 21, 2004 from the Individual Retirement Account ("IRA") portion of the 

Escrow Fund and should not offset your benefit for the amounts you received from your 

personal account in the Escrow Fund on March 2, 2004 and December 21, 2004. 

As a result of this decision, PBGC will send you a corrected determination letter 

regarding your monthly benefit amount and annuity starting date. The corrected 

determination letter will include a new 45-day right of appeal. 

PBGe's Determination and Your Appeal 

PBGC determined your benefit by calculating your monthly benefit under the 

Plan as of an annuity commencement date of August 1, 2006 and offsetting this benefit 

by two distributions you received from the Escrow Fund that was created by you, Better 

Business Forms, Inc. ("BBF") and Allfirst Trust Company (the "Escrow Agent"). The 

Enclosure is a copy of the Escrow Agreement. The two distributions were in the 

amounts of (1) $32,210.85 on March 2,2004; and (2) $12,692.58 on December 21, 

2004. 

In your March 28, 2008 appeal letter and your earlier March 21, 2008 letter, you 

said that you believe the information PBGe used to calculate your benefit was incorrect. 

You state that $3,924.95 was "the only money that was distributed to me from the 

pension account" and that "other monies that I received were all withdrawn from the 

escrow account of my personal funds, as well as the interest that was earned." You 

also provided documents from Coastal Pension Services, LLC ("Coastal") and bank 

statements to support your appeal. 
- 2 -

Legal and Factual Background 

PBGC is the U.S. govemment agency that provides pension insurance in 

accordance with the Employee Retirement Income Security Act of 1974, as amended 

("ERISA"). If a plan sponsor is unable to support its pension plan, PBGC becomes 

trustee of the plan and pays pension benefits as defined in the plan, subject to legal 

limitations and requirements set by Congress under ERISA. 

Records available to the Appeals Board show that the BBF Plan terminated on 

April 30, 2004 and that PBGC became the Plan's trustee on November 23, 2005. 

PBGC's records show that your late husband, I Iwas a Participant 

of the BBF Plan and earned a vested accrued benefit i-nder the Plan. PBGC's records 

also show that I Iwas born on ~ _1934 and died on j l1998 

before starting to receive a benefit under the BBF Plan. 

The records show that you chose to defer receipt of your pre-retirement survivor 

benefit ("PSB") until early 2000. At that time, you elected to receive your PSB in the 

fonn of a lump sum. 

The Plan actuary's calculated a lump sum of $243,674.76, based on an accrued 

monthly benefit of $1,841 and a lump-sum factor of 132.36 as of February 2000. As 

your husband was a highly-compensated employee and the Plan's assets would have 

been less than 110% of the value of the Plan's current liabilities after the distribution of 

the lump sum, part of your lump sum was considered "restricted" under Treasury 

Regulation § 1.401(a)(4)-5. 

Thus, in order to receive the lump-sum distribution, you entered into the Escrow 

Agreement in accordance with section 5.20 of the BBF Plan and Revenue Ruling 92-76. 

In accordance with the Escrow Agreement's terms, (1) the Plan paid you the 

$243,674.76 lump sum; (2) you rolled the entire amount into an IRA within the Escrow 

Fund; and (3) you deposited $36,824.34 of your own funds to bring the initial balance of 

the fund to $280,499.10, an amount equal to 125% of the "restricted" portion of your 

lump sum. At all times, the Escrow Agent maintained separate accounting of the funds 

in the I RA and your separate funds. 

In 2003, the Plan's actuary calculated the balance of the Escrow Fund to be 

$309,694.76, of which the restricted portion was $221,987.13. Thus, the amount 

available for distribution at that time was $32,210.85 [$309,694.76 minus 

(125% x $221,987.13)]. The Escrow Fund's records show that you withdrew this 

$32,210.85 amount from the Escrow Fund on March 2, 2004, at which time your 

personal funds in the Escrow Fund covered the entire amount, and the Escrow Agent 

paid it to you from your personal account within the Escrow Fund. 
- 3 -

In 2004, the Plan's actuary calculated the balance of the Escrow Fund to be 

$280,118.88, of which the restricted amount was $213,941.04. Thus, the amount 

available for distribution at that time was $12,692.58 [$280,118.88 minus 

(125% x $213,941.04)]. The Escrow Fund's records show that you withdrew this 

$12,692.58 amount from the Escrow Fund on December 21,2004. The documents you 

'submitted show that, at the time of the Withdrawal, the balance of your personal account 

within the Escrow Fund was $8,824.96. Therefore, the Escrow Agent paid you the 

balance of your personal account plus $3,867.62 from the IRA. An email from M&T 

Bank (the Escrow Agent's successor) to PBGC confirms that the second distribution you 

received on December 21, 2004, was composed of $8,824.96 from your personal 

account and $3,867.62 from the IRA asset account within the Escrow Fund. [This 

$3,867.62 amount differs slightly from the $3,924.95 amount you claimed in your letter 

to PBGC and is more favorable to you.] 

Discussion 

Based on the facts above, we have concluded that PBGC should offset your 

PBGC benefit by the annuity equivalent of the $3,867.62 that you received from the 

Escrow Fund's IRA on December 21, 2004 and not by the annuity equivalent of the 

lump sums you received from your personal account on March 2, 2004 and 

December 21 2004. 

Please note, however, that during our review of the calculation of your benefit, 

we learned that PBGC's actuaries lacked some of the information you supplied with 

your appeal letter when they calculated your monthly benefit and did not check the 

accuracy of your estimated annuity commencement date. Therefore, we have asked 

PBGC to review its calculation of your husband's accrued benefi" and your annuity 

commencement date2 when it recalculates the offset to your PBGC benefit, and to make 

any necessary corrections. 

Decision 

Having applied the law to the facts of your ease, we changed PBGC's 

determinatton by finding that PBGC should offset your monthly benefit by the annuity 

equivalent of the $3,867.62 lump sum that you received on December 21,2004 from the 

IRA portion of the Escrow Fund and should not offset your benefit for the amounts you 

received from your personal account in the Escrow Fund on March 2, 2004 and 

December 21, 2004. This decision is PBGC's final action regarding the amount of the 

2 

PBGC calculated your husband's accrued benefit at age 65 to be $1,409.50. The documents you 

submitted to PBGC, on the other hand, show that Coastal calculated your husband's accrued 

benefit at age 65 to be $1,841.00. We have asked PBGC to resolve this discrepancy. 

Application of PBGC's "Required Beginning Date" policy may result in an earlier annuity 

commencement date and appropriate backpayments. 
- 4-

lump sum you received on December 21, 2004 that will result in an offset to your PBGC 

benefit. 

As a result of this decision, PBGC will send you a corrected determination letter 

regarding your monthly benefit amount and annuity starting date. The corrected 

determination letter will include a new 45-day right of appeal. 

We regret the delay in responding to your appeal and appreciate your patience 

while PBGC prepares your corrected determination letter. If you need other information 

about your PBGC benefit, you may call PBGC's Customer Contact Center at 

1-800-400-7242 and ask to speak to the authorized representative assigned to the BBF 

Plan (Case 202002). 

Sincerely, 

Michel Louis 

Appeals Board Member 

Enclosure