Belgarath

Does this help? (From 4041.31(f) (f)If no notice of noncompliance is issued. A standard termination is deemed to be valid if - (1) The plan administrator files a standard termination notice under § 4041.25 and the PBGC does not issue a notice of noncompliance pursuant to § 4041.31(a); and (2) The plan administrator files a post-distribution certification under § 4041.29 and the PBGC does not issue a notice of noncompliance pursuant to § 4041.31(b).

QDRO - let me see if I can clarify what I was trying to say. Let's say that I own 100% of A and B. I sell the assets of A, as discussed in the original post, but A still exists, since it was an asset sale. So, A and B are still a controlled group, but there are no employees of A, as they have all gone over to "C." I've been informed me above this is a normal thing to do in a corporate transaction (and it seems very reasonable). So, to now transfer plan sponsorship to "B" it really seems like just a matter of amending the plan to change the sponsoring employer - it isn't a "multiple employer" situation, as it is still a controlled group. Thoughts? Thanks again. P.S. - so, assuming "C" will not assume any of the assets in a spinoff, etc. transaction, then this is a severance of employment for the former "A" employees, a partial plan termination with 100% vesting, etc. - distributable event - all the normal stuff.

So, Corporation A and B form a controlled group. "A" is the sponsor of a plan, and "B" is a Participating Employer. For purposes of this question, let us assume that "A has an EIN of "1" and "B has an EIN of "2." We just found out that someone purchased "A" several months ago, SUPPOSEDLY in an asset purchase. The information is a bit sketchy at this point, as the new owners of the assets of "A" will apparently keep the same business name, but change the EIN to another number. I don't know enough about corporate transactions to know if this is possible - in other words, can I purchase the assets of "A" and those "assets" include the right to continue doing business under the same name, but just under another (new) EIN? If so, then it appears that "A" and "B" are now, in fact, still a controlled group, as "A" still exists under EIN #1 and the ownership technically hasn't really changed? And that the asset purchase/issue of new EIN now creates a new entity, "C" which must now choose either to adopt the assets and liabilities of the former "A" plan, or establish an entirely new plan? I'm finding this very confusing when determining how to handle the plan issues. All of the employees of "A" are now part of "C" if in fact there is a new entity "C." Whether "C" will continue with a plan is unknown. But "B" wants to continue to sponsor the plan as is, with no involvement with "A" or "C." This works fine if there is no controlled group, as if there isn't, it is just a Multiple Employer Plan at this time, and can withdraw or spinoff or whatever under normal procedures. I'd love to hear nay thoughts on this. Getting solid data from the client in this situation is like pulling hen's teeth, so I'd rather have a better understanding of the corporate issues before using the vise-grips. Thanks!

Perhaps call the DOL and ask them this question?

You are right, I shouldn't assume. On the other hand, if politicians (and I will refrain from using names lest I offend people) don't have to worry about facts, why should we... Well, thankfully we are held to a higher standard than politicians.

FWIW, I was operating on the assumption that the TPA, whoever, incorrectly calculated the 2X amount and told the employer to deposit that amount.

You are probably too young to remember the Mouseketeers, even on reruns. Just substitute TPA for MIC, then CPA for KEY, then go directly to MOUSE. Tom Poje likely has a musical number that incorporates this...

I'd be comfortable with considering this a "mistake of fact" - and allowing the return of contributions. A mathematical error is one of the situations that the IRS mentioned in a PLR from back in 1994 - let me check - 9144041. Seems to me that if the TPA, CPA, EA, MOUSE, whatever gave the employer a calculation that said "deposit x dollars for the match" and there turns out to be a slipped digit somewhere, it qualifies. I assume this is within 12 months of the error? Almost has to be - don't see how they could have deposited the 2017 match in May of 2017... Well, ok, I suppose they could have deferred the maximum by then, and deposited the match as well, but let's say it is unlikely.

Cuse - yes, there was a discussion of this issue a while back - I'm sure you could find it with a search. Suffice it to say there was disagreement on the subject, as there is here. You pays your money and you takes your chances...

30's? That's for lawn chairs and sun tan oil. (Or the rednecks just use lard)

Northern New England. At least it is never dull, and we don't get the awful hurricanes and tornado weather that many other parts of the country get, so we really aren't so badly off. Plus, it gives us a form of entertainment - griping about the weather. Hard to do that if you live in San Diego.

Heckuva way to start a Monday morning. Oh well, supposed to be in the 60's tomorrow, so it'll be gone in a day or two. I never take my snow tires off until May anyway, so just an irritation rather than a real problem. Now I just need some cheese to go with this whine.

Never saw the movie, but if it is as bad as the joke, I made a good choice!!

Well, that's a good point. The Code does say "any" plan covering employees of such person or any other member of such group... I was going to get Thai food for supper, but perhaps I'll try a little crow instead.

The latter.

Yuck...

Wow, that's a massive penalty structure. A very powerful incentive to be careful! Have you had anyone since, to whom you related this situation, who still ignores your advice on this? (Just curious - is the Mass penalty 300% of the Federal penalty, or 300% of the otherwise applicable State level penalty?)

Cuse - yes, "paired" with a SEP. It isn't a situation where the SEP contribution has anything whatsoever to do with 403(b) eligibility, deferrals, etc., etc. - it just exists completely independently.

How often do you see this combination - a non-ERISA deferral only 403(b), so no 5500's, and a non-IRS "prototype" SEP for the employer contributions, so no 5500's? Just curious.

Agree with CuseFan, but be careful if it is a community property state. The spousal noninvolvement exception might not apply. I know that not everybody agrees on this issue, so they may wish to seek legal counsel if applicable.

Ok - very informative. Like you, I've never seen this. Good to know. Gracias.

Interesting - so extending this, suppose it is a Roth contribution, and it sits in the plan earning interest until distributed 30 years later at age 65 when the participant retires. (For purposes of this discussion, I'm assuming no in-service withdrawals allowed.) Presumably this is then not a "qualified" Roth distribution even though more than 5 years/59-1/2 is satisfied, and the full amount INCLUDING earnings is taxable.

Thanks John - this is VERY helpful!

Hi Kevin - thanks. Yeah, that makes sense. I just don't see much in the way of "special" language specific to a multiemployer plan that's actually necessary in a fairly standard situation such as what I was asked about. If they ultimately ask us to do anything with this plan, I'd probably go ahead and do a draft and then run it by an ERISA attorney. It's likely, however, that we'll end up with no involvement in this particular situation.

Sadly, my abilities do not extend to crashing the IRS website. If they did, I'd be wealthy beyond dreams...