SIMPLE and 401(k)

[Randy Watson]

Company A acquired company B. Company A has a 401(k) plan and company B has a SIMPLE plan. Company A is not eligible to maintain the SIMPLE plan. Can the SIMPLE plan be merged into the 401(k)? Would it make more sense to terminate the SIMPLE and let the participants roll their SIMPLE $$ into the 401(k)? Can this be done mid-year?

[actuarysmith]

You have until the year-end following the plan year in which the two organizations became part of a controlled group.

Therefore, let the SIMPLE plan run out the current year and then create a joinder agreement to let the employees of company B participant in the plan sponsored by Company A in the following year.