Improper Distribution?

[Guest bmurphy]

Am working with a client who was divorced last year. In October she was issued a distribution for her Profit Sharing balance which was in plan with ex-husband (she worker for him). The balance was over $5,000 - client said she never completed distribution paperwork. Husband simply wanted her "out of the plan". She just got a copy of the 1099-R (after numerous phone calls). No 20% withholding was done, distribution code was 1.

My understanding is that a plan cannot force out a participant if their balance is over $5,000. How should my client proceed in getting this rectified? She would like to roll over the full distribution amount to avoid taxation & penalty. As a side note, shortly after she received the check & deposited it a lien was put on her bank account from a credit card company that she was joint on with husband. Ultimately she had to pay them $6,000 to clear up lien. She does have enough funds available now to do a rollover. Any guidance would be appreciated.

[QDROphile]

One consideration, but not the only one, is a letter ruling request for an extension of the rollover deadline.

[Guest bmurphy]

Since they apparently forced paid her in error, what about going back to her ex-employer & asking them to re-issue the distribution as a rollover? Granted she may not want to go that route due to relationship with ex-husband. Does the PLR process take a while? Client is concerned since tax filing deadline is coming. Would they need to file for an extension while waiting for the PLR?

[Guest bmurphy]

Employer now says they will correct the distribution as it was done in error. What is the "proper" way for the distribution to be reclassified as a rollover?