The impact of a company acquisition on a 401(k) plan depends on the type of sale that occurs as well as what is decided within the purchase agreement. These transactions can be fairly complex and it is always advisable to work with competent tax and ERISA counsel when deciding what to do with any existing retirement plans.
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While you have various options on what path to take, timing can be important as the IRS closes off some options once the transaction is complete. It is very crucial that the purchase agreement does not contradict the options that the companies have chosen.
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If your company has become part of a controlled group of employers or is operating as a division of the acquiring company and you wish to keep your plan at Guideline, please contact us to discuss any possible options for keeping Guideline as your plan’s service provider.
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Guideline relies on the direction of the companies involved in order to understand how to treat a 401(k) plan when an acquisition has taken place. If you are unsure on how to handle your company’s 401(k) plan due to an acquisition, please consult a legal professional for direction and then contact us to take action at offboarding@guideline.com.

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