Money Purchase Pension Plan merger final Form 5500

[Guest tcunagin]

We are merging Money Purchase Pension plans with the Profit Sharing plans during 2002 with proper resolutions and adoption agreements to stop accruing benefits. My question is on some the employer will have to make a small 2002 contribution on some since the 60 notice was not processed until early in this year. Since the contribution does not have to be deposited until 2003 can we consider the contribution as transferring with the other assets in 2002 since the MPP plan is closed and do a final 2002 return? Should we have them go on a deposit the funds in 2002 and then transfer? We are trying to avoid having to do returns for 2 years versus one. HELP!

[imchipbrown]

My gut reaction is that the contribution receivable is like a promissory note. You would transfer the "note" along with other plan assets. I see no reason it would be inproper to repay the "note" after it is in the PS plan.

My two cents.

Chip Brown

[E as in ERISA]

That's the way I've seen it done most of the time. (In other cases, they don't even record the payable in the money purchase plan, but I don't recommend that).