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February 20, 2009

Eligible Party

Your Guide



Eligible Party means

(a) A court appointed representative with authority to terminate the plan and dispose of an orphan plan’s assets;

(b) In the case of an Orphan Plan under investigation by the Department of Labor, a person or entity who the Department of Labor determined has accepted responsibility for terminating the plan and distributing the plan’s assets; or

(c) In the case of a Qualified Plan to which Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”) has never applied, a surviving spouse who is the sole beneficiary of a plan that provided benefits to a participant who was

(i) the sole owner of the business that sponsored the plan and

(ii) the only participant in the plan.

Referring Cite

29 CFR 2578.1, Revenue Procedure2006-27

Additional Helpful Information

Orphan plans arise for a number of reasons, including

a) the death of a sole proprietor/plan sponsor,

(b) bankruptcy,

(c) the removal of plan fiduciaries by the DOL,

(d) mergers and acquisitions, and

(e) the disappearance or unwillingness of plan fiduciaries to act.  ( DOL)

Written By

Denise Appleby

Denise is CEO of Appleby Retirement Consulting Inc., a firm that provides IRA resources for financial/ tax/legal professionals. She has over 20 years of experience in the retirement plans field, which includes training and technical consultation.

Denise writes and publishes educational /marketing tools for advisors; available at Denise co-authored several books on IRAs

Denise is a graduate of The John Marshall Law School, where she obtained a Masters of Jurisprudence in Employee Benefits, and has earned 5 professional retirement designations.
She has appeared on numerous media programs, sharing her insights on retirement tax laws.


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