412(e) Plan

[jkdoll2]

Company got bought out - there is no income in 2008 for owner and employee (2 person plan). They want to terminate the plan.

They do not want to make premiums in 2008 - just cash in the insurance and annuity products.

Is the contribution required on a 412(e) plan? Can they just take what they got accrued in the insurance policies?

Since they did not have any income - they would not be able to deduct the premiums.

Thanks