A plan has a normal retirement age of 55 (yes, I know that is unrealistic BUT I have statistics to prove it is valid for red-headed actuaries working on PPA <GG>!!)

The plan document has the following definition of actuarial equivalence:

Pre-retirement

[/indent]Interest

7%

[indent]

Mortality

None

Post-retirement

Interest

5%

Mortality

UP84

What is the 2008 415 dollar limit at 55??

The lesser of the age 55 equivalent using the 5% UP84 equivalent or the 5% equivalent on the appropriate applicable mortality table for the limitation year of the payment.

That was the answer I was hoping for. However, this does not appear to jive with the description in the final regulations:

"limit generally is determined as the actuarial equivalent of the annual amount..........as a deferred straight life......"

The regulations, of course, do not anticipate using different rates. However, the AE value of the deferred annuity would seem to invoke the use of the pre-retirement interest rate as an adjustment.

No, I think you are safe to use 5% from age 55 to 62. That is the intent of the plan.
From 55 back, you would adjust at your 7% assumption for younger ages.

So, if a participant were 45, you would adjust the 415 limit using 5% annuity factors and the 7% pre-retirement interest rate to get the immediate 415 benefit payable at 45?

I would use a 5% discount from 62 to 55. Then 7% from 55 to 45.

Frank, you might want to check the document. I think the 415 language may state that the reduction is applied from 62 using plan equivalence or statutory, whichever is greater, and your plan language may lead directly to the 7%, by accident or not.