Jump to content

DC plan termination


Guest JM123

Recommended Posts

DC plan has a proposed termination of 12/31. If assets are distributed say June 1 of next year, IRS will respect 12/31 termination date and not require plan doc to reflect changes after that date.

What is the authority for requiring compliance with procedural tax qualification rules after the 12/31 termination, e.g., QJSA notices & consent, etc.?

Link to comment
Share on other sites

DC plan has a proposed termination of 12/31. If assets are distributed say June 1 of next year, IRS will respect 12/31 termination date and not require plan doc to reflect changes after that date.

What is the authority for requiring compliance with procedural tax qualification rules after the 12/31 termination, e.g., QJSA notices & consent, etc.?

I think it's because exemption is under 501(a) (exemption for trust that satisfies requirements of 401(a)) and such rules are required under 401(a). IRS respects termination date prior to liquidation for purposes of determining documentary compliance, but does not relieve plan of obligation to comply with tax qual requirements in effect as of proposed termination date.

Anyone agree/disagree or have other thoughts?

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...