Full Version: Terminating Defined Benefit Plan
I have a client that terminated their defined benefit plan a few months ago and is now looking to start a new one. Is there any issues with this?
415
401(a)(4)
416
etc.
401(a)(4)
416
etc.
You will need to pay attention to all those David mentioned.
Over the years, we have had a few takeover plans where prior plan DB accruals were not taken into account when a second DB plan was adopted by the same employer. This is a very important consideration, especially with small plans where the company owner(s) is getting maximum benefits.
Over the years, we have had a few takeover plans where prior plan DB accruals were not taken into account when a second DB plan was adopted by the same employer. This is a very important consideration, especially with small plans where the company owner(s) is getting maximum benefits.
QUOTE (Dougsbpc @ Feb 23 2010, 10:17 AM) 
You will need to pay attention to all those David mentioned.
Over the years, we have had a few takeover plans where prior plan DB accruals were not taken into account when a second DB plan was adopted by the same employer. This is a very important consideration, especially with small plans where the company owner(s) is getting maximum benefits.
Over the years, we have had a few takeover plans where prior plan DB accruals were not taken into account when a second DB plan was adopted by the same employer. This is a very important consideration, especially with small plans where the company owner(s) is getting maximum benefits.
You also need to determine whether the company prior to now is a part of a controlled group or ASG within 415 meaning. If the person was not a majority owner, you might need an attorney's determination about aggregating the old & new plans.
.There has to be a pretty darned good explantation why this happened. If it was just to get the money out of the plan, then starting a new plan could be perceived as a subterfuge of the normal retirement age regs.
QUOTE (Andy the Actuary @ Feb 23 2010, 01:30 PM)
.There has to be a pretty darned good explantation why this happened. If it was just to get the money out of the plan, then starting a new plan could be perceived as a subterfuge of the normal retirement age regs.
Eggplantation? Oh sorry, not what you meant!
QUOTE (SoCalActuary @ Feb 23 2010, 04:57 PM)
Eggplantation? Oh sorry, not what you meant!
Maybe he did mean that.
Eggplantation - A farm where eggs are planted
QUOTE (Andy the Actuary @ Feb 23 2010, 09:07 PM)
Eggplantation - A farm where eggs are planted
Brings new meaning to the chicken-or-egg debate.
QUOTE (Andy the Actuary @ Feb 23 2010, 06:07 PM)
Eggplantation - A farm where eggs are planted
Well, that eggsplains everything.
I'm thrilled no one castigated me for my egg-galitarianism.
Oh, ho. Now I'm shell shocked and scrambled, for sure. You guyz yust crack me up wit' yer yokes. 
QUOTE (GMK @ Feb 24 2010, 03:17 PM)
Oh, ho. Now I'm shell shocked and scrambled, for sure. You guyz yust crack me up wit' yer yokes.
All egg talk is giving me eggzema!
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