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A recordkeeper is asking for approval from a TPA in order to process a Internal Roth Rollover. TPA is saying that it's not warranted b/c they view it similarly as an asset-reallocation. I disagree and view believe the TPA needs to provide the approval because IRRs are governed by the Plan, has reporting requirements, and tax implications while an asset-reallocation does not. Any thoughts?

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Does the TPA normally provide approval for distributions for this plan?  Bird and Patricia are both right.  The IRR needs to be permitted by the Plan, and there should be some procedure for processing, which might include the TPA if that's how other transactions are handled.

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I'd be careful with terminology.  Unless this TPA is taking on the role of a plan fiduciary in some capacity, the TPA doesn't "approve" distributions.  A TPA would "confirm" that the requested distribution or IRR is permitted by the plan and that the participant is eligible for it.  But a non-fiduciary TPA doesn't approve anything.  Might seem to be a little thing, but us TPAs are obsessed with lots of little things. 

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52 minutes ago, shERPA said:

I'd be careful with terminology.  Unless this TPA is taking on the role of a plan fiduciary in some capacity, the TPA doesn't "approve" distributions.  A TPA would "confirm" that the requested distribution or IRR is permitted by the plan and that the participant is eligible for it.  But a non-fiduciary TPA doesn't approve anything.  Might seem to be a little thing, but us TPAs are obsessed with lots of little things. 

Well said.

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