401h and overfunded plan

[K2]

My client has a DB plan that is over-funded in the sense that the assets exceed the plan termination liabilities.  The owner at the company is at her 415 limit.  The financial advisor on the case has suggested a 401h account.  His thought is that excess assets could be transferred to a 401h account in the plan.  I am completely unfamiliar with this.  Do any of you have any familiarity with  this, or know of a good resource on this topic?

Thanks!

[david rigby]

This is a circumstance that needs frank discussion with the plan's actuary.  

Any other participants?  Is the owner's 415 limit likely to increase soon (eg, what is the owner's age)?  Is the excess considered "a lot"?  Is the death benefit properly defined and funded?  (Other actuaries will ask questions I haven't thought of.)

[K2]

Yes this plan has a participant at the 415 limit and it will increase.  The majority owner is 60..  There are about 35 other participants.  There is less than 100k in excess assets and the total assets are $8 million.  It is a cash balance plan,  there is no insurance in the plan.  The  death benefit is the account balance.

[chc93]

What about transferring the excess assets to a qualified replacement plan...  $100K with 35 participants... seems like this could be allocated within a year.