Plan Termination

[Guest pcohen]

Can an employer that maintains a frozen 401(k) plan and is a participating employer in a multiple employer 401(k) plan terminate the frozen plan and "park" the frozen accounts in the multiple employer plan? Or must either (i) a plan merger occur or (ii) wasting trust be created?

[JanetM]

You are correct, you either have to merge the plan or leave "as is" in frozen state. If one plan is frozen it makes sense to merge. You give participants more access to funds, you reduce fees and you simplify life overall.