(a) Annual benefit. For purposes of this subpart annual benefit means the benefit payable annually under the terms of the plan, exclusive of any benefit not required to be considered for purposes of applying the limitations of §415, Internal Revenue Code, to the plan, payable in the form of a straight life annuity with no ancillary benefits. If the benefit is payable in any other form, the annual benefit shall be adjusted to the equivalent of a straight life annuity pursuant to Section 45-37-123.132(c).

(b) Final regulations under §415, Internal Revenue Code. Notwithstanding anything in this subpart to the contrary, the following provisions apply beginning on or after January 1, 1976, except as otherwise provided in this subpart.

(1) INCORPORATION BY REFERENCE. The limitations, adjustments, and other requirements prescribed in the plan shall comply with the provisions of §415, Internal Revenue Code, and the final regulations promulgated thereunder, including, but not limited to, limitations relating to both defined benefit and defined contribution plan limits, the terms of which are specifically incorporated herein by reference for limitation years beginning after December 31, 2001, except where an earlier effective date is otherwise provided in the final regulations or in this subpart. However, where the final regulations permit the plan to specify an alternative option to a default option set forth in the regulations, and the alternative option was available under statutory provisions, regulations, and other published guidance relating to § 415, Internal Revenue Code, as in effect prior to April 5, 2007, and the plan provisions in effect as of April 5, 2007, incorporated the alternative option, the alternative option shall remain in effect as a plan provision for limitation years beginning on or after July 1, 2007, unless another permissible option is selected herein.

(2) GRANDFATHER PROVISION. The application of this subpart shall not cause the maximum annual benefit for any member to be less than the member's accrued benefit under all the defined benefit plans of the county or a predecessor employer as of the end of the last limitation year beginning before July 1, 2007, under provisions of the plans that were both adopted and in effect before April 5, 2007. The preceding sentence applies only if the provisions of such defined benefit plans that were both adopted and in effect before April 5, 2007, satisfied the applicable requirements of statutory provisions, regulations, and other published guidance relating to §415, Internal Revenue Code, in effect as of the end of the last limitation year beginning before July 1, 2007, as described in Treasury Regulation §1.415(a)-1(g)(4).

(3) ADJUSTMENT TO DOLLAR LIMIT AFTER DATE OF SEVERANCE. In the case of a member who has had a severance from employment with the county, the defined benefit dollar limitation applicable to the member in any limitation year beginning after the date of severance shall automatically be adjusted under §415(d), Internal Revenue Code.

(c) Treatment of qualified governmental excess benefit arrangements. Pursuant to §415(m), Internal Revenue Code, in determining whether the plan meets the requirements of this section, the annual benefit does not include benefits provided under any qualified governmental excess benefit arrangement as defined in §415(m)(3) Internal Revenue Code.