Multiple 401K Plans in acquiring Corporation due to asset buy sell in same tax year

1) Corporation A sells assets to Corporation B then buys assets of Corporation C, all in one tax year.
2) Corporation A had a 401K that it terminates in same tax year but after making contributions (deferrals and employer match) for 1/2 year in year of sale.
3) Corporation A, after buying assets of Corporation C, adopts/takes over the existing 401K in Corporation C and begins to make contributions (deferrals and employer match) for the balance (1/2) of the same tax year.

100% Owner/Participant is the same person in Corporation’s A and C

Owner/Participant did not contribute more than the allowed maximum deferral amount between the combined plans he participated in for the year of Sale/Purchase.

There was no intent to have 2 plans in the same corporation in the same tax year (Corp A) as the Buy/Sale just happened to take place in the same tax year due to health issues of the seller of the assets of Corporation C.

What experience with this kind of situation has anyone had?



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