Safe Harbor Cont/Plan Termination

[Guest jusducki]

If a 401(k) 3% Safe Harbor plan is terminating due to sale of company, does the 3% contribution just have to made through 4/30? I know there's a potential government relief of a Safe Harbor contribution but I thought that only applies to a plan terminating for reasons other than company sale. Appreicate someone making time to confirm with my situation the 3% will only have to be made through 4/30. Thank you.

[Jim Chad]

It sounds like 4/30 is the sale or term date.

Lots of questions. Let's take a few:

Is 4/30 the sale date?

Is it a sale of the company or the sale of the assets?

[Guest jusducki]

I asked if sale was of the Company or assets and was told two things: 1) if Company is sold, only 60% of it would be sold; 2) if Company doesn't sell, the Plans (they also have a DB which we do not administer) would still be terminated on 4/30. Are either of these two answers specific enough for me to know if the 3%SH can end on 4/30? Thank you.

It sounds like 4/30 is the sale or term date.

Lots of questions. Let's take a few:

Is 4/30 the sale date?

Is it a sale of the company or the sale of the assets?

[Jim Chad]

You can stop the 3% SHNEC by terminating the Plan. But I am not sure about the 4/30 date.

I think you have to give a new notice 30 days before termination telling the Participants that the Plan is being frozen and there will be no benefit accruals after the date in the notice.