Special Pay Plan

[30Rock]

I know this is a 401k forum but could not find an appropriate folder. Does anyone have experience with setting up a 401a plan just for making a one time contribution of unused sick and vacation leave? I see the IRS in 2005 put out internal guidelines stating this could only be done if the plan otherwise has recurring contributions, or via a 403b plan 5 year post termination contribution. But a large provider named Bencor has many school systems using their document for these special pay plans. I am not sure how they can still do this?

Any thoughts?

[mbozek]

Bencor received IRS approval for volume submitter DC qual plans of public employers to receive lump sum contributions of terminal payments of sick pay and leave because public plans are exempt from the nondiscrimination rules under 401(a)(4). IRS suspended approval of future qual plans established for receiving one shot payments in 2005 but I don't think the IRS revoked the qual status of existing plans.

I don't know any more because I am not involved in that market.

It seems that the existing plans can still accept new contributions.