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Late non-ERISA 403(b) creation, then termination?

Guest mcleod9

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Guest mcleod9

Hello all -- My first post to this forum, though I've been a reader for a little while. The following question has come up with a potential client that I hope to hear some opinions on.

They had an small, old, deferral-only 403(b) with one mutual fund company (that no longer works with 403b plans, of course) that they stopped allowing deferrals to before 1/1/09. A new 401(k) was created. They don't have a plan document for the 403(b). I believe that some current staff have directly rolled their old 403(b) into the new 401(k).

My question is this: What's the best and most cost-effective way to get their situation up to speed. My sense is that they'd be able to adopt a model non-ERISA 403(b) plan doc and terminate it all at once, right? Is there a model doc around that non-profits might use? And the doc should includes language on termination options for staff to roll their 403(b) accounts over to a new 401(k). What would a corrective fee be for this late adoption? I believe they've tried to contact all individuals to let them know about the prior 403(b) ending, though they couldn't require a rollover to the new 401(k).

Thanks for any thoughts or for pointing me to any other posts on this site that address this issue.

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