Taking care of orphans – How to deal with a 401(k) orphan plan
Abstract: An orphan plan is a plan that no longer has a plan sponsor. The plan may run afoul of both the Internal Revenue Code (IRC) and ERISA. The IRC includes qualification requirements relating to a plan’s tax-favored status. When a plan is no longer sponsored by an employer, it may no longer comply with IRC requirements and may lose its qualified status. This article reviews what happens to orphan plans.