This section contains information on the requirements needed to terminate your plan, should that become necessary. This section also provides a detailed description of your role, as well as that of the plan participant and the ABA Retirement Funds Program (the Program).

Highlights

In the chart below you will find the steps to terminate your plan, and an indication of whether the Plan Participant, Plan Administrator or the Program is primarily responsible for taking the step.

Steps for Terminating the PlanPlan Participant’s RolePlan Administrator’s RoleThe Program’s Role
1. Determine if plan is terminating
2. Ensure Program has the most recent census information, especially for previously terminated participants.
3. For money purchase pension plans or target benefit plans, distribute 204(h) notice to participants prior to terminating the plan, in accordance with applicable guidance
4. Decide whether to request a determination letter on the termination and, if so, file the determination letter application with the IRS and notify all interested parties, as required
5. Adopt any necessary amendments to your adoption agreement
6. Notify the Program by submitting the Plan Termination Notification Form
7. Forfeit unvested employer contributions from the accounts of all participants who have incurred a five year break in service.
8. Fully vest all affected participants (i.e., current employees and former employees who have not incurred a five year break in service prior to the plan’s termination date)
9. Reallocate remaining forfeiture balance among eligible participants if instructed to do so with the Plan Termination Notification form.
10. Make the final employer contribution, if any, and ensure all employee 401(k) salary deferrals have been contributed
11. If not addressed in the above steps, ensure the forfeiture account is liquidated and allocated as required.
12. Send the Distribution Request Form to participants (wait until you have received a determination letter, if one has been requested)
13. Participant elects whether to receive a distribution or roll over account assets
14. Complete the Distribution Request Form and send it to the Plan Administrator
15. Review, sign and send the Distribution Request Form to the Program
16. Process Form
17. Send check and confirmation notice regarding the distribution to participant
18. Send IRS Form 1099-R to participant and IRS
19. Prepare final Form 5500 for Plan Administrator within six months following the month in which the final distribution took place
20. Review and e-file final Form 5500 with DOL by the last day of the seventh month following the month in which the final distribution took place

*Note: Many of these steps can be performed by the Program; by signing and submitting the Plan Termination Notification Form, you are providing authorization for the Program to perform certain steps on your behalf.