I currently have both a Money Purchase Pension Plan and Profit Sharing Plan with Vanguard as the trustee. I would like to set up a second Profit Sharing Plan with a discount broker so that I can purchase individual securities, without necessarily transferring everything I have in the Vanguard plan. It seems to me that I should be able to do this as the annual contribution to my current plan is not a fixed percentage. I am currently contributing 10% to the MPPP and 15% of income to the PSP. I've gotten different advice from various sources and would like some assurance that I can do this. Has anyone out there done this? Is it legal? If so, can I roll over or transfer part of the Vanguard PSP money into the new plan? Thanks in advance.
You just start a new Prototype. Be sure your total annual payments are correct. I did this throughout the 60's, 70's & 80's ending with about 5 "plans", but probably had about 10 total. Had 5 5500s to file each year. I transfered bank CDs as they matured into Funds, but never combined all the Funds until I took a LSD, when I transferred (agent to agent) them all into the oldest one. Mine were all Profit Sharing. I note your's are not all the "same kind of Plan", so you must not combine, nor transfer funds from one "Kind of Plan" to another "Kind". What you will have the IRS calls, I think, different "trusts" within a "Plan". The prohibition in each trust preventing investment in other funds applies to you asking Vanguard to invest their funds in TRPrice funds. They are not preventing you from having another Prototype. Hope this is what you were looking for. At the time I couldn't find any Rules on the subject, so I just did it. Ed
I am 95% sure total contributions to ALL Profit Sharing plans can only be 15%. Just like total contributions to all IRAs can only be $2,000.
Ed-Thanks. This is what I was looking for. So I take it you had several different funds, each at a different company (Vanguard, TRP, etc.) each in a separate PSP prototype. Ultimately, you have combined them all into one. But it sounds like there is a problem with selling part of one of the funds, and then transferring that into one of the other prototypes. I would like to do that, but does that mean I would have to close that particular PSP prototype completely and move everything from it?Thanks again. Bob
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