Controlled group termination???

[FAPInJax]

I am posting this for another lady, so hopefully I get all the facts straight!

There is a controlled group of 2 companies (each owned by brothers).

One of the brothers has decided that he wants his company out of the plan (it has come out of full funding and they do not want to make contributions). An additional complication is that the brothers have each tracked their contributions and presumably earnings. The brother who wants out KNOWS that his assets are greater than the PVAB.

First, is there a way (other than a spinoff to get the company out of the plan - including paying off the participants). I do not believe that to be possible.

What gets filed with IRS / PBGC IF there is another way???

One potential problem that I pointed out is whether the plan will still pass coverage and I was assured that it should not be a problem.

Anything else they should be worried about???

Thanks in advance for any insight.

[AndyH]

They could amend the plan to prospectively make service for the "withdrawing" company to be non-covered service, so there would be no further benefit increases, although service for vesting would continue to accrue. Then you have 410(B), and, possibly more importantly, 401(a)(26) issues, however.