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Showing results for tags 'amending plan'.
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Situation - plan (not our document, but appears to be Sungard language/format) is currently a standardized 401(k). The definition of allowable hardship is the safe harbor definition. Employer is selling corporation to two employees (husband and wife) in an asset sale. Part of the purchase price was to have come from a distribution from the plan. Since the soon-to-be new owners wish to assume the assets and liabilities of the plan and continue it, there is no severance of employment, so no distributable event. Neither is purchasing a business considered a safe-harbor hardship, nor are they 59-1/2 so they can't do an in-service of the deferrals. Here's my question - if they amend the plan to a volume submitter and utilize a non-safe harbor hardship definition, and then make a determination that the purchase of a business (either by themselves or any other employee) constitutes an acceptable "hardship" do you see any problem with this? While admittedly self-serving, it seems to me to be the only way to simultaneously accomplish all their goals. Would appreciate any thoughts.
