Merging a MPP plan into a PS plan; what must you do? I know that spousal consent issues come, still attached to the funds that derived from the money

[Guest Enda80]

What happens or what must you do when you merge a money purchase plan into a profit-sharing plan? What plan language is required? Do the assets that derive from the money purchase plan count as rollovers?

[J Simmons]

Because the MPP benefits have the QJSA/QPSA rights attached, they must be separately accounted for under the PS plan. You ought to have plan language that mentions that such forms of benefit are the default, and attendant rights apply.

There is an IRS ruling (circa 2002 I believe) that did away with the requirement that preceded it that the MPP benefits had to be immediately vested on a merger.

The MPP benefits will not be 'rollovers' if you truly merge the MPP into the PS plan. On the other hand, if you terminate the MPP plan, give all those with benefits the option of QJSA form of payout, but also a lump sum and rollover options, then those that choose (with spousal consents) to roll into the PS plan (assuming its language accepts rollovers), then the benefits are 'rollovers' and washed of the QJSA/QPSA rights by virtue of the spousal consents. However, employees could on an individual basis choose to roll over to an IRA, to take a lump sum, or to take the QJSA, instead of rolling over to the PS plan.