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100% tax withholding on deminimus distributions?


Guest Cricket1

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Guest Cricket1

Can you see a problem with a plan sponsor directing a 100% tax withholding on deminimus payouts for participants that whose whereabouts are unknown and all efforts have been exhausted? Plan Sponsor would rather see the money go directly to the IRS under the participants SSN than to forfeit the money only to have to deal with the hassle /concern of the participant resurfacing later, having to rebuild accounts, etc. They also concern over having to keep a balance in the forfeiture account due to this issue.

The document says that the money should be forfeited but they see this as a round about way as a deminimus paid to the participant. Any thoughts?

:confused:

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