Search the Community
Showing results for tags 'deferral changes'.
Found 1 result
-
The question is how does the 5-year delay rule for subsequent deferral elections (under Reg. Section 1.409A-2(b)(ii)) apply to a form of payment change where the plan pays on the earlier of a fixed date designated by the employee and separation from service. Fact pattern: Plan pays upon the earlier of a specified distribution date designated by Employee and Employee's separation from service and offers payment in either a lump sum or fixed installments. Employee timely makes an initial election to be paid in a lump sum and designates January 1, 2020 as his specified distribution date. Employee files a subsequent deferral election by December 31, 2018 changing his elected form of payment from a lump sum to fixed installments and moves his designated distribution date to January 1, 2025. If Employee incurs a separation from service in, for example, 2023, must his benefit be paid in a lump sum pursuant to his initial election or installments pursuant to his subsequent deferral election? Example 15 makes clear that with respect to a payment deferral he still gets paid on separation from service. Any citations, guidance or authority on point would be helpful.
