kmhaab Posted April 1, 2019 Posted April 1, 2019 401(k) plan was terminated in 2018. Due to a recordkeeping error, assets were incorrectly distributed to Employee A instead of Employee B. Plan sponsor needs to correct the overpayment to Employee A and the incorrect distribution (i.e. underpayment) to Employee B. How is this done if the 401(k) plan and trust have been terminated? They can recover the overpayment from Employee A, but how is it formally returned to the plan and distributed to Employee B if the plan has been terminated? Do they need to rescind the termination?
Cardscrazy Posted April 22, 2019 Posted April 22, 2019 termination doesn't end business as usual; it just stops new contributions and new participants post-termination date.
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