Disqualify a SIMPLE Plan with $200 of Employer match in this year

[Jim Chad]

A company wants to start a 401(k) plan now, for the usual reasons.

They just started deferring in May so the 3 Participants don't have much money yet. I know that if they take the employee money out of the disqualified plan this year, the taxes are a wash.

But they each have between $100 and $200 in employer match? How is the match money handled?

[Gary Lesser]

JIM, SEE RECENT POST AT http://benefitslink.com/boards/index.php?/topic/54339-getting-rid-of-a-simple-due-to-adoption-of-another-plan/

[Jim Chad]

Thank you, Gary.