### Question
How is the term qualified replacement plan defined?


### Answer
The term **qualified replacement plan** is defined in *26 U.S.C. § 4980* as the following:

> a qualified plan established or maintained by the employer in connection with a qualified plan termination (hereinafter referred to as the “replacement plan”) with respect to which the following requirements are met:


#### (A) Participation requirement


At least 95 percent of the active participants in the terminated plan who remain as employees of the employer after the termination are active participants in the replacement plan

#### Citation:
  - *26 U.S.C. § 4980*
  - Heading: **Subtitle D-Miscellaneous Excise Taxes > CHAPTER 43-QUALIFIED PENSION, ETC., PLANS**

