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EP Examination Process Guide - Section 9 - Participant Rights - Plan Events - When a Plan is to be Terminated

When a plan is to be terminated, participants should receive a written notice of the company’s intention to terminate the plan and a notice of plan benefits.

Notice of Intent to Terminate the Plan

Description: Written notification that the plan sponsor (generally the employer), intends to terminate the plan or cease benefit accruals.

What It Should Contain: The notice should contain sufficient information to notify the participant of the termination of the plan.  The notice might include identifying information such as:

  • the plan name and number;
  • the proposed termination date;
  • a statement concerning the cessation of accruals (benefit accruals are ceasing); and
  • a statement that there are sufficient plan assets to meet the accruals provided under the plan.

Timing: The notice must be provided to all affected plan participants and/or beneficiaries at least 60 days and no more than 90 days before the proposed date of termination.

Who Is Responsible For Sending It: The administrator of the plan.


Notice of Benefits Upon Termination of the Plan

Description: A notice that is issued to each affected participant and/or beneficiary that specifies the amount of the participant’s benefit as of the proposed termination date.

What It Should Contain: The notice should identify the amount and form of each participant’s benefit including any personal data used in determining the amount of the benefit, including lump sum conversions, mortality and interest rates used to compute the benefit.

Timing: Promptly to any affected participant or beneficiary after the proposed termination date and on or before the distribution date.

Who Is Responsible For Sending It: The administrator of the plan.

Page Last Reviewed or Updated: 17-Oct-2013