PS Posted July 28, 2022 Report Share Posted July 28, 2022 Terminating plans with forfeiture balance - there are couple of terminating plans with small balance in the forfeiture account ( example: $ 500 or $1000), the plan sponsor don't have any invoice hence the only option they are left with is to re-allocate to the eligible participants. The plan sponsor is required to determine the eligible participants for which they will require to refer the plan document, however since the $ amount is less they just don't want to do this and they end up re-allocating the funds equally or on a pro-rata base to the ones who were active during the plan termination. Now this leads to testing failure. How can this be avoided is there any exception on the re-allocation, so that they don't fail the testing. Link to comment Share on other sites More sharing options...
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