Can I roll over any part of my esop to another tax qualified plan?

[Guest insurerr]

Work for a company that has esop. In April, company is changing to 401k. Can I roll over any of my esop now to any

other tax deferred plan. We were told we could roll over up to 70% now, and the balance before we put any money into 401k. Does anyone know anything about this? Please advise.

[RLL]

Hi insurerr ---

All or any portion of benefit distributions received in connection with the termination of a tax-qualified ESOP (except for any amount representing the return of after-tax employee contributions) may be "rolled over" (or directly transferred by the trustee, as directed by the participant) on a tax-deferred basis to an individual retirement account ("IRA") or to an employer-sponsored qualified retirement plan (including a 401(k) plan) that accepts such rollovers.

The company that is terminating the ESOP is required by law to notify you in writing regarding the options that are available to you.

[david rigby]

The original post did not say anything about the ESOP terminating. More facts are needed. Is the ESOP terminating? being frozen? converted to a 401(k) plan? merged into a new 401(k) plan?

These are different situations. Only the first of these could lead to a distribution.

[RLL]

pax ---

If an ESOP is either "frozen" or converted (or merged) into a 401(k) plan, the employer could provide that benefit distributions will be offered to participants. In that event, any such distributions would be "eligible rollover distributions" under IRC Section 402©(4).