metsfan026 Posted October 4, 2021 Share Posted October 4, 2021 Taking over a case that has two Plans, a Profit Sharing and a fully funded Defined Benefit Plan. Is there any issue with terminating the DB Plan, rolling it into an IRA and then opening a new Cash Balance Plan? Thanks in advance! Link to comment Share on other sites More sharing options...
C. B. Zeller Posted October 4, 2021 Share Posted October 4, 2021 The 415 limit is cumulative for all plans sponsored by the same employer (or controlled group). If you terminate and distribute, that distribution will permanently reduce the 415 limit in the new plan. Luke Bailey 1 Free advice is worth what you paid for it. Do not rely on the information provided in this post for any purpose, including (but not limited to): tax planning, compliance with ERISA or the IRC, investing or other forms of fortune-telling, bird identification, relationship advice, or spiritual guidance. Corey B. Zeller, MSEA, CPC, QPA, QKA Preferred Pension Planning Corp.corey@pppc.co Link to comment Share on other sites More sharing options...
CuseFan Posted October 4, 2021 Share Posted October 4, 2021 Depending on how long the existing plan has been in place, you might have permanency rule issues. Unless there are excess assets they want distributed or sizeable liabilities they want to take off the table, why not just convert the DB (I assume traditional) into a CB? Plan terminations are not always trivial exercises either, if PBGC covered and/or filing with IRS. Kenneth M. Prell, CEBS, ERPA Vice President, BPAS Actuarial & Pension Services kprell@bpas.com Link to comment Share on other sites More sharing options...
Recommended Posts
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 accountSign in
Already have an account? Sign in here.
Sign In Now