Contribution of Stock to DB Plan

[Scott]

Can a publicly-traded employer contribute its common stock to its defined benefit plan? I'm aware of Keystone and the DOL's Interpretive Bulletin in which the DOL basically states that any in-kind contribution to a DB plan is a prohibited transaction. However, both Keystone and the examples in the DOL Bulletin involve real property. I have seen other guidance addressing the contribution of other types of property, but nothing on employer securities.

It appears that ERISA Section 408(e) would allow this contribution, as long as the contribution does not cause the total employer stock held by the plan to exceed 10% of the fair market value of the plan's assets. Can anyone confirm this?

[Guest Harry O]

Yes, this can be done and has been done by many publicly-traded companies recently.