Guest Jules1 Posted November 15, 2014 Share Posted November 15, 2014 I have ran into a non-profit organization that has an old 457(b) deferred compensation plan that has not been funded for years. They replaced the plan with a 401(k) plan several years ago. Several participants have accounts in both plans and would like to roll their 457(b) accounts over to the 401(k) plan but have been told they cannot rollover and can only get to their account upon termination of employment or at age 70 1/2. I am unfamiliar with these plans and wondered if the plan could be terminated or restated to a different type of plan that could then be merged with the 401(k) plan. Any suggestions as they feel locked into this old plan.. Link to comment Share on other sites More sharing options...
mbozek Posted November 15, 2014 Share Posted November 15, 2014 There are regs under 457 that have instructions on how to terminate a 457b plan and pay out distributions. Account balances in a terminated 457b plan of a NP can only be transferred tax free to another NP 457b plan. rollover to an IRA or a 401k are not permitted. 457 plan cannot be merged with a qualified plan. mjb Link to comment Share on other sites More sharing options...
Guest Jules1 Posted November 16, 2014 Share Posted November 16, 2014 Not sure what you mean by NP? Also can an existing 457b plan be amended to change the distribution options? As I have been informed the existing plan only allows distribution at termination of employment or at age 70 1/2 if the participant is still employed. Being a non-profit a fair number of employees work at part-time status well past 65. Does NP stand for non-profit? Link to comment Share on other sites More sharing options...
mbozek Posted November 17, 2014 Share Posted November 17, 2014 Its my understanding that withdrawal options in a 457b plan are limited. I don't have any source materials with me.Answer may be found in IRS pub 525. Why not contact the provider for the 457 plan? NP is non profit. mjb Link to comment Share on other sites More sharing options...
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