Termination of SIMPLE IRA?

[Guest bjg]

How do you terminate a SIMPLE IRA? Are you required to continue the SIMPLE IRA for the entire year, or can it be terminated by giving a 60-day notice? This question has arisen in an acquisition context where the acquiror would like to bring the acquired company's participants into its plan, but the participants are presently (for 1999) covered by a SIMPLE IRA. Certain provisions of Section 408(p) seem to indicate that it would have to be continued for all of 1999.

[Gary Lesser]

You are correct in your thinking. Amendments made during the year can be made effective during the year, BUT ONLY if they are not inconsistant with the 60-(or more) day Notice (previously distributed).