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401(a) plan merged into 403(b) plan - how to correct


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Employer merged a 401a plan into a 403b plan at the end of October. During March next year, employer removed the 401a assets from the 403b plan and merged the 401a assets into another 401a plan (this was part of an acquisition). There were no plan amendments/resolutions drafted. The TPA who helped them thought that they were working with two 403b plans.

If the 401a plan merged into the 401a plan last year, as intended, we would have had a late amendment that could be corrected under VCP by adopting a retroactive amendment to memorialize the merger.

Because the assets are merged during the current year, there is no late amendment issue for the 401a merger.

There is an error but not sure how to correct. Any suggestions?

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  • 4 months later...

TAXLLM,

Any chance the entity is a steeple church? If so, there are some new church regs coming some time in the future (we have no idea when) which now will allow this type of merger. We know we will be able to do this we just don't know HOW yet.

It's nice to be important, but it's more important to be nice...

CPFA, CPC, QPA, QKA, ERPA, APA

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