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A closely-held corporation has a defined benefit plan for its officers and employees. Due to a stock market decline, the plan is underfunded and the corporation does not have enough cash to make its minimum pension contribution. To meet the shortfall, the President of the corporation wants to donate a valuable oil painting to the plan. This action is:

Sagot :

When the President of the corporation wants to donate a valuable oil painting to the plan. This action is "an illegal transaction involving a party-in-interest and the plan".

Employee Retirement Income Security Act (ERISA):

The main purpose of (ERISA) are-

  • Transactions between the plan trustee and alleged "parties-in-interest" are expressly forbidden by ERISA.
  • Any fiduciary, advisor, or employee of the plan, as well as any employer whose employees are covered by the plan, are considered "parties-in-interest."
  • Sale, exchange, or leasing of property between the plan and a "party-in-interest," a loan to a "party-in-interest," the provision of goods, services, or facilities to a "party-in-interest," the transfer of plan assets to a "party-in-interest," or the use of plan assets by a "party-in-interest" are all prohibited transactions.

To know more about ERISA, here

https://brainly.com/question/24057264

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