No. of Recommendations: 1
Greetings, Mcmcgui, and welcome. You asked:

The company I work for was recently sold and the 401K plan was “frozen” except that we can move money within the allowed funds. We are told that the original owner of the company must get a determination letter from the IRS that the Plan is in order. Is this the usual procedure when a company is sold and a plan is closed out? The funds are frozen for 9 to 12 months!

That's not at all an unusual event when a company has been acquired by another. Before the old 401(k) assets can be transferred into the new owner's plan, the new owner wants to ensure those assets have in no way been "tainted" with unqualified money. If they have, then the tainted money would disqualify the new employer's plan. Therefore, your old plan must provide the new plan with the qualification letter from the IRS. That letter may indeed take up to a year to obtain.

Regards...Pixy
Print the post  

Announcements

The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement