Definitely determinable definition
Definitely determinable also means that there must also be a consistent formula to determine the DROP benefits. Many tax attorneys believe that if a DROP plan earns market rates of return without a fixed rate, index or formula, that a DROP plan could be deemed to be a separate defined contribution plan on top of a defined benefit plan. Such a design would make DROP plans unattractive since such a plan would be subject to §415(c) IRC limiting the amount of compensation per year that could be deposited. The Internal Revenue Code has certain income limits for retirees under §415(b). Different limits apply to public safety personnel at different ages to reflect their usual earlier normal retirement age. Amounts paid from a DROP account must be considered in these limits.