thepensionmaven Posted April 1, 2019 Share Posted April 1, 2019 A terminated participant has a vested account balance of less than $1,000. Per the terms of the plan will make a mandatory distribution of account balances that are $1,000 or less. The distribution will be made as soon as administratively feasible. The vested amount is >$200, must the participant sign an election form? Link to comment Share on other sites More sharing options...
jpod Posted April 1, 2019 Share Posted April 1, 2019 The document may be more employee-friendly, but under the law I believe that all you need to do is to give the participant the option of a direct rollover within the time frame specified by the regulations, but absent such an election you can send the participant a check minus 20% FIT withholding. I am going on memory so hopefully someone will correct me if I am wrong. rr_sphr 1 Link to comment Share on other sites More sharing options...
RatherBeGolfing Posted April 1, 2019 Share Posted April 1, 2019 If participants distributions for the year are less than $200, the plan does not have to provide a direct rollover option and is not required to withhold. Just pay out and 1099. Notice 2018-74 Link to comment Share on other sites More sharing options...
Doghouse Posted April 1, 2019 Share Posted April 1, 2019 ">" means greater than Link to comment Share on other sites More sharing options...
Pam Shoup Posted April 2, 2019 Share Posted April 2, 2019 Send the distribution package out to the participant. If s/he does not respond by the date specified, you can cut them a check for the gross amount minus withholding. The key is that you must give them an opportunity to select a distribution option (where there is an option) prior to the auto cash out/auto rollover. Pamela L. (Bobersky) Shoup CEBS, RPA, QKA AMI Benefit Plan Administrators, Inc. 100 Terra Bella Drive Youngstown, Ohio 44505 800-451-2865 www.amibenefit.com Link to comment Share on other sites More sharing options...
RatherBeGolfing Posted April 2, 2019 Share Posted April 2, 2019 On 4/1/2019 at 5:17 PM, Doghouse said: ">" means greater than I need IV coffee sometimes... Link to comment Share on other sites More sharing options...
BG5150 Posted April 3, 2019 Share Posted April 3, 2019 13 hours ago, RatherBeGolfing said: I need IV coffee sometimes... 4 coffees is a lot! QKA, QPA, CPC, ERPATwo wrongs don't make a right, but three rights make a left. Link to comment Share on other sites More sharing options...
RatherBeGolfing Posted April 3, 2019 Share Posted April 3, 2019 Especially when you prefer Cuban coffee like me :| Link to comment Share on other sites More sharing options...
thepensionmaven Posted April 3, 2019 Author Share Posted April 3, 2019 Or did you mean IV, as in IntraVenus? Link to comment Share on other sites More sharing options...
RatherBeGolfing Posted April 3, 2019 Share Posted April 3, 2019 I did, but I assume it was a roman numeral pun on BGs behalf. 4 Cuban coffees might as well be an IV though ha ha Link to comment Share on other sites More sharing options...
G8Rs Posted April 9, 2019 Share Posted April 9, 2019 jpod is correct. You must provide the participant with a 402(f) notice. If the participant makes no election for a direct rollover, then you can either make a distribution (and withhold 20%) or the plan can do a direct rollover to an IRA. It depends on the plan terms - and if the plan is silent, then it's a procedural issue as to which way to go. Many find that cutting the check is a problem because you can't force someone to cash a check. Link to comment Share on other sites More sharing options...
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