Authority To Terminate Plan

Definition of "Authority to terminate plan"

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Jim Howrey, Real Estate Agent Keyes Real Estate

Means of ending a pension plan only for reasons of business necessity, following IRS regulations. If the IRS determines that the plan was terminated for other reasons, employee and employer contributions become taxable. Reasons acceptable to the IRS include bankruptcy, insolvency, and the inability of a business to continue to make its contributions because of adverse financial conditions.

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