Merge 403(b) plan into 401(k) plan?

Can a non-profit 403(b) plan be merged into a 401(k) plan?

No. There are provisions for individual participants to roll distributions they receive from a 403(b) plan to a 401(k) plan. However, there is no legal basis for a merger of plans, or any kind of transfers between 403(b) and 401(a) plans other than rollovers. 

Is this non-profit a church?

A church 401(a) plan can be merged with a 403(b) plan, but.... the PATH Act of 2015, which allows this under a new Code Section, 414(z), has no regulations written yet. When this was added to the Code, the Treasury was directed to issue rules on what is required. I have not seen guidance on this yet.

So the Code is all you have:

414 (z)  Certain plan transfers and mergers 

(1)  In general Under rules prescribed by the Secretary, except as provided in paragraph (2), no amount shall be includible in gross income by reason of—

(A)   a transfer of all or a portion of the accrued benefit of a participant or beneficiary, whether or not vested, from a church plan that is a plan described in section 401(a) or an annuity contract described in section 403(b) to an annuity contract described in section 403(b), if such plan and annuity contract are both maintained by the same church or convention or association of churches,

(B)   a transfer of all or a portion of the accrued benefit of a participant or beneficiary, whether or not vested, from an annuity contract described in section 403(b) to a church plan that is a plan described in section 401(a), if such plan and annuity contract are both maintained by the same church or convention or association of churches, or

(C)   a merger of a church plan that is a plan described in section 401(a), or an annuity contract described in section 403(b), with an annuity contract described in section 403(b), if such plan and annuity contract are both maintained by the same church or convention or association of churches.

(2)  Limitation 

Paragraph (1) shall not apply to a transfer or merger unless the participant’s or beneficiary’s total accrued benefit immediately after the transfer or merger is equal to or greater than the participant’s or beneficiary’s total accrued benefit immediately before the transfer or merger, and such total accrued benefit is nonforfeitable after the transfer or merger.

(3)  Qualification 

A plan or annuity contract shall not fail to be considered to be described in section 401(a) or 403(b) merely because such plan or annuity contract engages in a transfer or merger described in this subsection.

(4)  Definitions For purposes of this subsection—
(A)  Church or convention or association of churches 

The term “church or convention or association of churches” includes an organization described in subparagraph (A) or (B)(ii) of subsection (e)(3).

(B)  Annuity contract 

The term “annuity contract” includes a custodial account described in section 403(b)(7) and a retirement income account described in section 403(b)(9).

(C)  Accrued benefit The term “accrued benefit” means—
(i)   in the case of a defined benefit plan, the employee’s accrued benefit determined under the plan, and

(ii)   in the case of a plan other than a defined benefit plan, the balance of the employee’s account under the plan.