Is it really going to happen on January 1, 2006?

[Guest PB&J]

Is anyone 100% convinced that participants in a 403(b) plan will absolutely not be allowed to do a 90-24 transfer come January 1, 2006? Would you advise a client with a 403(b) plan who is switching providers to encourage participants, if they also want to switch providers, to do so NOW?

[GBurns]

I have been out of this for a while, so I am wodering what causes you to think that this might haoppen? Was there some recent law change that I missed?

[wmyer]

As of right now, there are only Proposed 403(b) regs. Until the regs are finalized, 90-24 transfers would still be permitted (so long as the plan permits them).

[Guest Herbert Hussey]

The proposed regulations do not eliminate all possible 90-24's. Rather, the proposed regulations, if they are enacted as presented, will permit 90-24 transfers only between vendors that are approved by the Plan Sponsor. Further, the proposed regulations have language stating that the transfer must not occur if there is a loss to the participant because of the transfer. This seems to suggest that there can not a surrender charge or penalty imposed because of the transfer. But, again, these are proposed reg, and we will have to wait until the final draft and implementation.

I would suggest a participant review the proposed regs before making a decision on making a 90-24 transfer.

Hope this helps,

Herbert Hussey