Abandoned 1 person/sole proprietor plan?

[Guest Bearlee]

So what do the custodians of these 1 person/no employee plans do since they cannot avail themselves of the DOL regulations on abandoned plans, since that's within the purview of Title I. Is there recourse to distribute the assets to an IRA and to terminate this plan -- by the custodian or TPA? Any input would be very helpful. Thank you.

[Jim Norman]

So what do the custodians of these 1 person/no employee plans do since they cannot avail themselves of the DOL regulations on abandoned plans, since that's within the purview of Title I. Is there recourse to distribute the assets to an IRA and to terminate this plan -- by the custodian or TPA? Any input would be very helpful. Thank you.

Someone abandons their own plan and their own money?

[Guest Bearlee]

So what do the custodians of these 1 person/no employee plans do since they cannot avail themselves of the DOL regulations on abandoned plans, since that's within the purview of Title I. Is there recourse to distribute the assets to an IRA and to terminate this plan -- by the custodian or TPA? Any input would be very helpful. Thank you.

Someone abandons their own plan and their own money?

Believe it or not, yes. And it's a good chunk of change too. Does the IRS have its own abandoned plan project?

[JanetM]

Escheat to the state maybe. Have you tried to find this person, are they sick, in jail, or what?

[Guest mjb]

Escheat to the state maybe. Have you tried to find this person, are they sick, in jail, or what?

Benefits in a non ERISA plan can be transferred to a state agency if the appropirate period of inactivity has elapsed but some states will not take any qualified plan benefits.

[Guest Bearlee]

Escheat to the state maybe. Have you tried to find this person, are they sick, in jail, or what?

Benefits in a non ERISA plan can be transferred to a state agency if the appropirate period of inactivity has elapsed but some states will not take any qualified plan benefits.

Turns out the EPCRS has a procedure under VCP for Orphaned Plan - but only eligible parties can act on behalf of the plan. Right now, it looks like we need to get court appointed to be an eligible party to take this to VCP and to terminate the plan. The problem is we believe this sole proprietor is still around, not complete unfit or incapacitated, but a recluse (dad died and she went into a deep depression). So it might be hard to even get a court appointment since the person is still technically around and not technically unable to handle her affairs. Very weird situation.

[Guest SWH]

If she's in that deep of a depression that she won't even sign the paperwork to move the money, maybe you could check around and see if she has siblings. Maybe one of them has a power of attorney on her already. It's a stretch, I know, but ...... if's she's a beneficiary form on file that should give you a starting point.

[Peter Gulia]

Bearlee, if the plan administrator and the plan trustee (we assume that it's the same person as the participant and the business owner) has not instructed a distribution, why is a service provider seeking to pay something that hasn't been asked for?

If the concern is about avoiding a need to perform services that might not be paid for, there are other ways to manage the service provider's obligations or other responsibility. (If you'd like a little help, I'll advise about that without fee.)

And if the service provider is considering some moral aspects of this situation, consider whether it might be unhelpful to pay money to a person who hasn't asked for it and is in "a deep depression".

[JanetM]

Bearlee, are you sure the plan is abondoned? Could it be that there have not be recent contributions but the owner still intends to keep the funds tax deferred for now?