Guest JDVJr Posted February 12, 2003 Posted February 12, 2003 Two entities, A and B, adopted a 401k plan as a controlled group. The ownership has changed and the controlled group does not exist anymore. A is a group of HCEs only. B has HCEs and NHCEs. A wants to suspend its participation in this plan and immediately adopt a new plan. Are there any pitfalls to doing this?
E as in ERISA Posted February 12, 2003 Posted February 12, 2003 You primarily see multiple employer plans when the companies are related (but just don't meet the 80% rule) and one party is managing both plans. If that is not the case, it's probably a good idea to separate the plans -- e.g., do a spin-off. Otherwise problems with one employer can taint the entire plan and trust.
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