Simple 401(k) To A Simple 401(k) Or Other Qp

[Guest AFRICA6796]

Can a SIMPLE 401(k) plan be rolled or transferred to another SIMPLE 401(k) plan or another qualified plan?

See this quick reference by TAGDATA.

http://www.tagdata.com/TAG-Quick-Reference...lover-Table.htm

Their interpretation seems logical- however, I have always thought we could rely on a Revenue procedure.

I contact a brokerage firm in New Jersey, but they seem unsure- according to them, the employer must decide.

[Belgarath]

I think you can rollover from a SIMPLE(k) to another SIMPLE(k). If you look at Revenue Procedure 97-9, Section 3.3(a), it allows rollovers. I haven't followed the code references through to see if it can be rolled to anything other than another SIMPLE(k), but I'm inclined to think it can, as the only reference is to 1.402©(2). Hope this helps.

[pmacduff]

Footnote (4) in your tagdata file references a code section and seems to pretty clearly state that you cannot roll a Simple 401(k) into a Simple 401(k) so I'm not sure what your question is. Did you look at 401(k)(11)(B)(i)(III)? That code section states that a Simple Plan can only take deferral and matching contributions.

[Belgarath]

Pmacduff - I notice that our replies were made at nearly the same time, so you may not have seen mine when you replied. Since the Rev. Proc. was meant to clarify the 401(k)(11) code section, I'd feel very comfortable relying on the Rev. Proc. rather than hanging my hat on the 401(k)(11) language. I'm not aware of anything since the Rev. Proc. was issued that would prohibit the rollover.

[Appleby]

.... what's your take on TAGDATA's statement that the IRS is exceeding their authority?

If there are two documents providing conflicting statements, then one must look at the document with the overriding authority. In this case, that would be the IRC.

[Belgarath]

Appleby - Since the IRS is also the agency charged with enforcing this, and the Rev. Proc. represents their thinking on the issue, I don't see a problem. Maybe my stance on this is too relaxed, but I don't see it as an issue that causes the IRS any concern, and I'd be very surprised, even if they changed their viewpoint, that they would try to enforce it retroactively. If it had just been a PLR, I would feel differently. But we'll have to agree to disagree. If I start thinking too hard on a Monday, I'll be useless for the rest of the week...

[Appleby]

I hear ya...

This is such a coincidence.

I had the same discussion with a very reputable retirements plan consulting firm (sorry no names)- which we just concluded this morning.

The same website TAGDATA was the center of the discussion- it was referred to me by a client . The consulting firm is of the opinion that the Rev. Proc stands.