JD54

Thank you for the link to the American Academy of Actuaries. If they can at least explain what has happened then I will feel a little bit better. I do have and have told the company of my POA, but it hasn’t helped me get more information. It is useful in making arrangements on the disbursement. I understand the concern for her age and have made the proper arrangements once the funds have been received. Thanks again.

I am sorry that I did not mention that this is my mother. She is 91 years old. The plan only presented us with options that have been previously mentioned and when I requested more information, I was told to get a Financial Advisor or Lawyer. They would not tell me any other options i.e., rollover to an IRA or even how the amounts that they were offering were calculated. This is a cash balance plan. She is entitled to a lump sum payment and that also has a retro component to it and is much less, cash wise, than the Single Annuity option. Her normal retirement age would have been 65. In the year 2004 she was 74. I highly believe that this has been a corrective action that was probably caught in an audit and they are trying to clear this up before being penalized. Don't get me wrong, it is a lot of money for the job that she performed, but the way they seem to be rushing the process and not responding to queries bothers me a lot. In the end she will be collecting the single annuity for life along with her workers comp and is still considered an active employee. I should be happy with that but something about how this was done has left a bad taste in my mouth. Thank you.

Thank you both for your replies. The CB plan is offering her a Lump Sum option along with a 10, 15, and 20 Certain payments. The Lump Sum offer is substantially less than the Single Annuity option, so much so that I can pay Federal and State taxes for the Single Annuity option and still have more than what was offered in the Lump Sum Amount. As I stated originally the Certain Payments would have been paid as though they began in 2004 and were also substantially less than the Retro Single Annuity option. All these options did have a Retroactive payment included with them, but the Single Annuity had the most money and a continuing monthly annuity for life. I only brought up the Workers Comp portion because that is how she is still considered an active employee and will continue to collect that portion as well. I haven't found anyone who has seen a situation such as this and could advise me. I would appreciate knowing which type of professional would be the most knowledgeable in this area. Thanks again.

Active employee is being told that she must take a 17 year retro payment of her CB Plan because she was earning more on her Interest in the plan than she had made in her best 3 years that ended in 2004. IRC 415 was mentioned in this case. She is well past retirement age because of being covered under the old workers comp rules from the 80's. They are offering her a Single Annuity option of much more money than is being offered as a Lump Sum payment due to her not receiving payments since 2004, along with interest and penalties I believe. If she takes the Single Annuity option she will continue to receive a monthly annuity for life along with this retro payment. All 10,15, and 20 year options would have to be started as though it was 2004. What options do I have with this retro payment? Can any of it be rolled into a Traditional or Roth IRA?