In my research, it appears that when a PBGC covered plan terminates, it looks like in the year of termination, you can deduct the full amount of the contribution necessary to cover the plans benefit liability (with a few exceptions...of course!).

What happens if you make the contribution to make the plan sufficient in the year of termination, and something happens to delay the distributions into the next plan year. Let's say that the applicable interest rate in the new year causes lump sums to increase, and thus another contribution is required to again make the plan sufficient.

How does deductibility of these contributions work? Is it one of those 10 year amortization instances? Any ideas where I can begin my search? In my example, there are no majority owners, so no one is able to waive receipt of benefits, so they would have to make the contribution in order to terminate.

Thanks!
Dennis

This question has come up before and there is some confusion. Personally, I think the change in liabilities is okay to consider. Just make sure the contribution is made within the 8 1/2 month deadline after the year of term, otherwise you have an issue with the deduction if you try and take it in following years.