Convert or Merge MPP

[Below Ground]

In the past it was permissable to restate a money purchase plan "into" a profit sharing plan. My questions are: (1) is that still allowed, and (2) what special issues need to be addressed? I know that "accured benefit" under the MPP must be provided for, and a "204(h) Notice" must be done. Alternatively, a merger and consolidation can be done, but a "direct conversion" by restatement would be cleaner, cheaper, and easier. Comments? Thanks!

[Guest Sieve]

Still allowed, as best I know. The biggest issues I can think of are to make certain that the QJSA & QPSA distribution requirements are carried forward on the MPPP money and that in-service distributions do not apply to the MPPP money and that spouse consent is required on any loans of the MPPP money (in the event the PSP does not otherwise require it)--but there may be other issues, too. I do not think vesting is an issue, because I believe the IRS has indicated that this is not considered a termination of the MPPP which requires full vesting.

[Lou S.]

Still allowed, as best I know. The biggest issues I can think of are to make certain that the QJSA & QPSA distribution requirements are carried forward on the MPPP money and that in-service distributions do not apply to the MPPP money and that spouse consent is required on any loans of the MPPP money (in the event the PSP does not otherwise require it)--but there may be other issues, too. I do not think vesting is an issue, because I believe the IRS has indicated that this is not considered a termination of the MPPP which requires full vesting.

I agree with this. You need to keep the MPPM seperate as it retaing the money purchase charateristics - if you don;t separately account all money would be subject to MP rules.

The only issue on vest is if it is not the same schedule, then it would be treated like a change in vesting. Assuming you are keeping the same vesting schedule then you would just march forward with it.

[Below Ground]

Beautiful! Thanks!