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I suspect I am breaking one of my own rules with this question. I suspect the rule I am breaking is am over thinking this problem but…..

With most DC plans it seems to be the conventional wisdom is coming down to the idea if you send a participant a PPA statement with their balance and a set of distribution forms you have met the statement notice requirements referred to with question 8 of the 8955-SSA.

But many ESOPs require a wait from the time of termination to payment—wait 5 years, wait until the loan is paid etc.

So one does not send a set of distribution paperwork to them before you have to report them on the 8955-SSA. We have a copy of Relius’ notice format that they say meets the requirements. So we were going to send one of those notices to people who have to wait for their payment. However, for this notice one needs to report something that reflects what you put in Part III column (d) & (e). For most DC plans you put an A and A—Single Sum and Lump Sum.

And historically that is what I have put and no one has questioned it as what most DC plans do.

But it is rather common for an ESOP to pay over 5 years. So should one have been answering this questions B and B—Annuity payable over fixed number of years and Annually?

You normally think of those answers only in the context of a DB plan. And for one thing the amount paid each of the 5 years isn’t going to be the same so what amount would you put for the answer in either 9(f) or 9(g)?

Just double checking.

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