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Peter, 1) Do you trust the government? 2) Do you think you can call "them" and get responsible answers to your questions? Ever try calling "IRS"? 3) The governments have done a great job with their own retirement plan liabilities. 4) Having to deal with government employees who get paid regardless of how good a job they do. 5) 6) 7) 8)........

How does a government "acquire" a not-for-profit entity? Such entities have no owners, so you can't purchase one. Did the government buy the assets, or what happened? The other issue to consider is whether the nonprofit is now itself a governmental instrumentality. If the only member of the nonprofit is a governmental entity, there is a good chance that it is. In any event, if the nonprofit has somehow failed to become a governmental instrumentality, and is still an ERISA plan and subject to coverage rules, I'm not sure how you could possibly apply them on a controlled group basis, given that such rules do not apply to governmental plans. You would, of course, still have to apply the universal availability rules.

Yes, if it's prepared on an accrual basis. Good Luck!

As a Trust Counsel for 8 years for a Top 100 Bank early in my career, I agree with most of what has been said and Peter Gulia's point is well-made. I think more specificity could be good in certain circumstances (non-institutional trustee, special knowledge and acumen regarding p. and p/s plans and rules, experience with the former trustee and the business, etc.) but I also agree with Luke that maybe you'd close some avenues to yourself that might change anyway. (I have two LLCs and I have confidence that my spouse, kids and/or estate attorney would handle this in the right way for my 2 DBs, NQDC, and numerous DC plans). Bottom line, it probably depends on the circumstances.

I would add to what Larry has said that 414(b) and (c) (by way of 1563), 267 (used for 4975), and 318, all have different attribution rules.

I'm hoping the following might be helpful from Derrin's book Who's The Employer, which you should own (here's a link to info: http://www.employerbook.com/). Grantor trusts are subject to a special rule. The grantor (or other owner) of a grantor trust is deemed the owner of all stock or business interests held in the trust. [Code §1563(e)(3)(B); BL 167] A grantor trust is one in which someone (generally the grantor, the person who set up the trust) is treated as the owner of trust property for tax purposes. [Code §§671-678] This normally happens when the trust is revocable, the grantor has kept the power to determine what happens to the money, or the grantor has kept an income interest in the trust. A grantor trust rarely files an income tax return, and income is reported under the ID number of the grantor. [Treas. Reg. §1.671-4(b)] Sometimes, a beneficiary can be the deemed owner of a grantor trust. [Code §678] The fact that the grantor is deemed to own everything in the trust does not prevent other beneficiaries from being allocated their proportional interest. Remember, the attribution rules are all about finding multiple persons who the law can treat as owning all or part of the stock. Example 9.12.1 Greta is grantor of a trust which owns 100 shares of Acme Widgets. The trust leaves all trust property to her son when she dies. The trust is revocable, and so it is a grantor trust. Greta is 43 at her nearest birthday. Assuming that the current interest rate is 6%, the IRS tables say the value of her son’s remainder interest is 16.301%. Since this is a grantor trust, Greta is deemed to own all 100 shares of Acme Widgets. Her son is a beneficiary and so he is deemed to own his actuarial interest, or 16.3 shares of the stock. Note that if the son is under age 21, he is deemed to own all stock his mother owns, and hence all stock held in her grantor trust. [Q 9:18] This is an example of permissible double attribution. Stock is attributed from the trust to the mother, and from the mother to the minor son. [Q 9:3] Example 9.12.2 Assume the same facts as Example 9.12.1, except that Greta has four children, who share equally in the trust. Each has less than a 5% actuarial interest (4.975% to be exact) and so none of them is deemed to own stock held by the Trust. Greta is still deemed to hold 100% of the stock. Example 9.12.3 Continuing Example 9.12.2, five years elapse, making Greta 48. According to the IRS tables, the remainder is now worth 20.383%, meaning each child has an interest slightly above 5%, and is deemed to own his or her pro rata share of stock. The same result could be achieved by lowering the interest rate. The moral is that beneficial interests are constantly fluctuating and should be rechecked annually. The birthday of a beneficiary is a logical date to use. However, in the interests of prudence, recomputation should follow any large shift in the interest rate. Example 9.12.4 Continuing Example 9.12.3, the trust contains a clause giving the trustee discretion to divide the trust as the trustee chooses between the four children, based on their needs and circumstances at the time. It is theoretically possible that any of the four children could receive all trust assets. Since the attribution rules assume that maximum discretion is exercised in a beneficiary’s favor, each child can be deemed to own 20.383 shares of Acme Widgets, the entire remainder interest. Example 9.12.5 Assume the same facts as Example 9.12.2. One of Greta’s sons, Bob, works at Acme Widgets. The trust provides that upon Greta’s death, all Acme stock goes to Bob, and the rest of the trust is divided between all four children. Bob is deemed to own 16.3 shares of Acme (the entire remainder interest) and the other three children are not deemed to own any of it. Example 9.12.6 (Warning: This is a math-intensive example, but unfortunately the fact pattern is amazingly commonplace. The good news is you just have to look things up in the right table(s), and then do simple addition and subtraction.) Harold, age 50, owns 100% of corporation C. He transfers it to a revocable grantor trust. The trust provides that upon Harold’s death, Harold’s wife, Wendy, age 48, receives a life interest in the stock. When Wendy dies (or Harold, if sooner), then the stock passes outright to their child, Chris, or to his estate. The applicable federal mid-term rate is 5%. Harold is deemed to own 100% of C because it is a grantor trust. Following the methodology from Example 1 in Publication 1457, Chris is deemed to own 17.740%, using the second-to-die table R2 available on the IRS web site. Chris receives nothing until both Harold and Wendy are gone, so that is why we use the second-to-die table. This means the value of the income interest up to the death of the later of Harold and Wendy is worth 82.260% (100% - 17.740%). [See Example 2 in Publication 1457] Wendy only owns a fraction of that remainder interest, because she must survive Harold. Harold’s life estate, according to table S, also available on the IRS web site, is 72.535% (using a 5% interest rate). That means the value of Wendy’s remainder interest is 9.725% (82.260% - 72.535%). [See Example 4 in Publication 1457] A person ceases to be a beneficiary of an estate once he has received all that he is entitled to and he probably will not need to pay it back. [Treas. Reg. §1.1563-3(b)(3)(ii)] Thereafter, he is not deemed to own property held by the estate. Example 9.12.7 Mary is named in her Aunt Margaret’s will. Mary will receive $50,000. Aunt Margaret’s total estate is $250,000 and includes 1,000 shares of XYZ stock. The Executor, under court order, distributes to Mary $50,000 cash from a savings account, and holds the rest of the estate for further administration. Before the distribution, Mary is deemed to own 200 shares of XYZ stock. After the distribution, she is no longer regarded as a beneficiary and is not deemed to own the XYZ stock.

by the way, as part of the Family Savings Act there is the following, so if they ever get things finalized for us.... SEC. 109. Exemption from required minimum distribution rules for individuals with certain account balances. (a) In general.—Section 401(a)(9) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph: “(H) EXCEPTION FROM REQUIRED MINIMUM DISTRIBUTIONS DURING LIFE OF EMPLOYEE WHERE ASSETS DO NOT EXCEED $50,000.— “(i) IN GENERAL.—If on the last day of any calendar year the aggregate value of an employee’s entire interest under all applicable eligible retirement plans does not exceed $50,000, then the requirements of subparagraph (A) with respect to any distribution relating to such year shall not apply with respect to such employee. “(ii) APPLICABLE ELIGIBLE RETIREMENT PLAN.—For purposes of this subparagraph, the term ‘applicable eligible retirement plan’ means an eligible retirement plan (as defined in section 402(c)(8)(B)) other than a defined benefit plan. “(iii) LIMIT ON REQUIRED MINIMUM DISTRIBUTION.—The required minimum distribution determined under subparagraph (A) for an employee under all applicable eligible retirement plans shall not exceed an amount equal to the excess of— “(I) the aggregate value of an employee’s entire interest under such plans on the last day of the calendar year to which such distribution relates, over “(II) the dollar amount in effect under clause (i) for such calendar year. The Secretary in regulations or other guidance may provide how such amount shall be distributed in the case of an individual with more than one applicable eligible retirement plan. “(iv) INFLATION ADJUSTMENT.—In the case of any calendar year beginning after 2019, the $50,000 amount in clause (i) shall be increased by an amount equal to— “(I) such dollar amount, multiplied by “(II) the cost of living adjustment determined under section 1(f)(3) for the calendar year, determined by substituting ‘calendar year 2018’ for ‘calendar year 2016’ in subparagraph (A)(ii) thereof. Any increase determined under this clause shall be rounded to the next lowest multiple of $5,000.

Respectfully disagree with Mr. Starr's flat "No". If your client is at least moderately aggressive and if the plan can be amended and the 2019 safe harbor notice distributed "quickly" (next couple of days) I would not hesitate going for it. Remember the IRS position that 30 days advance notice is deemed reasonable doesn't mean that a notice given 20 days in advance is automatically unreasonable.