JustMe Posted July 11, 2019 Report Share Posted July 11, 2019 Client maintained a SIMPLE IRA at the time of acquisition of an employer with a 401(k) plan and both plans will remain through the transition period of the end of the plan year following the year of the acquisition transaction. The SIMPLE IRA still only benefits the participants originally eligible for it and the same with the 401(k) plan. Can the 401(k) plan be amended and not destroy the transition period that allows the 2 retirement plans to exist simultaneously through the transition period? Link to comment Share on other sites More sharing options...
John Feldt ERPA CPC QPA Posted July 11, 2019 Report Share Posted July 11, 2019 Sure, you can amend to change the trustees and to change the plan name, things of that nature. Link to comment Share on other sites More sharing options...
Flyboyjohn Posted July 11, 2019 Report Share Posted July 11, 2019 Are you sure the 410(b)(6) transition rule applies when you're not dealing with 2 qualified plans? Also note that the 408(p)(10) transition rule for SIMPLE IRAs provides a longer transition period (end of 2nd calendar year after calendar year in which the offending transaction occurs) Link to comment Share on other sites More sharing options...
JustMe Posted July 12, 2019 Author Report Share Posted July 12, 2019 @John Feldt ERPA CPC QPA - The plan may need to be amended to allow an additional participating employer so that a newly acquired entity may now participate in that plan. I'm thinking that sort of an amendment that changes the coverage population would destroy it, but would appreciate your thoughts. @Flyboyjohn - Unfortunately this group doesn't have the 2 year transition period since the group exceeded the 100 person mark due to acquisitions. Link to comment Share on other sites More sharing options...
John Feldt ERPA CPC QPA Posted July 13, 2019 Report Share Posted July 13, 2019 My understanding is that amendment, as you described, would end the transition period. If your client is a serial acquirer, this is certainly one on the problems they face if they are relying on using the transition period. Link to comment Share on other sites More sharing options...
JustMe Posted July 16, 2019 Author Report Share Posted July 16, 2019 Great, thank you so much for responding John. That is my understanding/interpretation as well. Link to comment Share on other sites More sharing options...
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