Need advice to terminate VEBA plan for small employer

[Guest fplearner2005]

Given the scenario that the corporation over last 3 years is no longer making even enough money to pay salaries and that it does not see it getting out of this recession, what can be done ? The money that was in the trust account already funded the VUL policies for employees.

So somehow can the plan be amended or terminated so that the cash values be rolled over to individual annuities or irrevocable life insurance policy trusts to avoid tax consequences for the employees and shareholders who will now work elsewhere or even retire ?

Goal is to avoid tax for the employees, leave/convert VUL insurance policies in place, & not having to pay any ongoing administration overhead.

The plan is set up for multiple employer trust (Master Trust)

The corporation has its own trust, part of the master trust.

Established in 1997 & funded thru 2001.

[GBurns]

Isn't all of this covered in the PD and Trust documents?

Exit and funding strategies should have been among the prime considerations when participation in the scheme was initially contemplated.

What directions/opinions have the plan promoters presented?

Does this help?: http://benefitslink.com/IRS/revproc2005-25.pdf