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Freezing Money Purchase Pension Plan


chris

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MPPP has 1,000 hours and last day of plan year requirement. E/er required contribution is 10% of compensation. E/er is going to amend MPPP to freeze contributions and change contribution percentage for current plan year to 0% of compensation. Does anyone see any problems with this?

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Guest wolfpack

At first blush I cannot see any problem with this since the participants have not accrued a benefit for the current year.

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Remember that section 204(h) requires a somewhat tortured sequence of events. Notice must be provided AFTER adoption of the amendment and not less that 15 days BEFORE the effective date of the amendment. (The amendment must have a prospective effective date.)

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