Year-End Appropriations Act Provides Retirement Plan Sponsors with New, Temporary Method for Partial Termination Determinations

Andy Daly
Published

Reductions in force during 2020 that resulted in significant turnover in active retirement plan participation could constitute a partial plan termination that requires 100% vesting of affected employees. The Consolidated Appropriations Act of 2021 temporarily modifies prior IRS guidance on how to make a partial termination determination. This new, temporary statutory provision looks solely at whether the number of active plan participants on March 31, 2021 is at least 80% of the number of active plan participants on March 13, 2020. Click here to read the full alert.

Author
Andrew J. Daly