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A potential client has an existing defined benefit plan and would like to add a 401(k) Plan. His current TPA does not want anything to do with adding a 401(k) plan. Are there any pitfalls to adding a 401k plan to an existing defined benefit plan?

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Top heavy coordination.

Combined discrimination testing if tested together.

Combined deduction limits if DB is not PBGC plan.

The usually compliance testing issues.

 

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It adds complexity for sure, but in my opinion, as long as you are competent and capable that is no reason to "not want anything to do with adding a 401(k) plan".  

Of course there are also times when clients (or the client's CPA/adviser) want to add a plan or plan feature that just does not make sense...

 

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