Help - annual addition limits in the year of on asset sale

[Guest MikeD]

Does anyone have any input:

Hypothetical - Company A's assets are acquired by Company B during the Plan Year. Company A and Company B maintain 401(k) profit sharing plans. Company A will stay in business through the end of the Plan Year to collect receivables, etc.

Do the employees of Company A have the ability to receive annual additions greater than $42,000 ($46,000 for those who are catch-up eligible)? I can make an argument that they do, because A and B are not in a controlled group or affiliated service group.

Does anyone have any thoughts either way? I can't find a solid answer.

Thanks!

[Mike Preston]

If Company A and Company B are not in a controlled or affiliated group, they each can extend qualified plan benefits to their employees without consideration of the other. That means coverage, nondiscrimination and maximum limitations.