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Transfers from Taxable Entity to Tax Exempt Entity


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Employees are transferring from a taxable employer to a related tax exempt employer. Is it going to be possible to transfer the balances in their nonqualified deferred compensation plans to the "ineligible" 457(f) plans maintained by the tax exempt employer? If so, will the 457(f) rules for taxation apply to the funds, or are the taxation rules that apply to nonqualified amounts held under a taxable employer's plan grandfathered in some way?

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  • 1 month later...
Guest Robin Davis

Did you ever get your answer to this question? I would be interested to hear what you found out.

IMHO, it would seem that once the balances are "rolled over" into the ineligble 457(f) plan they would then take on the taxation rules under that section.

I would also be interested to hear how you handled the transfer of the financing vehicle. Was the plan originally financed by life insurance or mutual fund? If so, how did you handle the transfer of the asset to the tax exempt organizatoin?

I hope to hear from you soon!

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Robin Davis

D&D Benefits, L.L.C.

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