I have a client that is replacing its 403(b) Plan with a 401(k) Plan. The 403(b) Plan has many “lost” participants with significant account balances. (We have used the usual services to try to find these folks but to no avail).

It would very helpful to the “pricing” for the replacement 401(k) plan if there was a way to move the 403(b) Plan “lost participant” account balances into the new 401(k) plan. However, the regulations are clear that plan sponsors who freeze or terminate a 403(b) plan cannot merge or transfer the 403(b) plan assets into the new 401(k) plan. Any ideas?

403(b) money can be rolled over to a 401(k) plan. A distribution is required for a rollover. I am not suggesting that such a rollover is the appropriate way to deal with a lost participant. Nor am I suggesting that it is wrong.