cathyw Posted June 30, 2009 Posted June 30, 2009 A client currently maintains a 401(k) plan. Because of the changes in the Roth IRA rules for next year, many of the partners and other HCEs would like to take a distribution and roll over to a Roth IRA. I advised that distribution can only occur if the plan is terminated, and then they cannot establish a new plan for 12 months. The partners/HCEs would be okay with that, but they don't want the NHCEs to go without a plan. What if we spin-off the NHCEs to a new plan that excludes HCEs, and then terminate the original plan and distribute benefits to the HCEs. Does this work under the successor plan rules? The new plan is a successor plan with respect to the NHCEs, but is it a successor plan with respect to the HCEs who aren't eligible.
masteff Posted June 30, 2009 Posted June 30, 2009 See the discussion currently going on in this thread: http://benefitslink.com/boards/index.php?s...c=42659&hl= Kurt Vonnegut: 'To be is to do'-Socrates 'To do is to be'-Jean-Paul Sartre 'Do be do be do'-Frank Sinatra
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