Is an employer required to take advantage of Revenue Ruling 2000-27, w

[Guest katie korman]

IRS analysis of Rev. Ruling 2000-27 reveals that a transferred employee does not continue to work for the same trade or business if less than substantially all the assets of a trade or business are sold to an unrelated employer. Thus, 401(k) assets may be distributed. As a result of this Rev. Ruling, is such an employer now REQUIRED to offer distributions to the transferred employees? Can the option/right be withheld? If distributions are offered, does the plan have to be amended in any way to allow for this type of distribution? Do any plan-to-plan transfer restrictions from the seller's plan to the buyer's plan apply under the Rev. Ruling?