Existing PSP rules and regulations with Sister companies

[PA.Trenton]

Company A has a long term, Trustee Directed PSP on the books. About 300 employees in total.

Company A buys a new business, under new DBA and corporation. Does not want to add the employees from the new Acquisition to the existing PSP. Would prefer to keep them separate. Does not want to offer a plan to the employees of the new business.

Is it possible to keep the existing plan, with no additional new money contributions?? Or would the plan have to compensate the new employees from the new acquisition? Or have to dissolve the existing plan if not willing to add the new employees to the existing plan? Or start a new plan all together for them??

THanks,

T

[Mike Preston]

Any semi-competent TPA will be able to answer your questions if you can provide them with some basic information on the employee populations of A and New DBA.

[ESOP Guy]

The answer is "depends".

As Mike says I would go talk to an expert to get help. It really depends on the facts. Something as small as forfeitures in the future in the plan might cause problems with keeping the plan as is. On the other hand one can easily imagine a set of facts that allows you to keep the PSP and putting more money into it. It just depends on so many factors.

To decide what can be done is going to take way more facts then you are giving here and most likely can be given efficiently via a forum like this.

This is a good time to spend a little money for expert help in my opinion.