Delay in Cashing Distribution Check

[DP]

We have a participant who never responded to our Profit Sharing distribution requests. Her balance was less than $5,000 so we finally made a taxable distribution to her in April 2001. The 20% federal tax was also deposited in April 2001. The participant has never cashed her distribution check so it is being reissued to her. She is now wanting to roll the money over to her IRA. Will this be considered an eligible rollover since more than 60 days have elapsed since the check was written in April? Or do you start the 60-day clock over again when the replacement check is issued? The original check was not lost in the mail - the participant had it in her possession all this time.

Also the participant thinks we should refund her 20% federal tax to her so it can also be rolled over. I know that can't be done.

[Alan Simpson]

If the participant had the check in April then it is a distributable event at that time and should not be changed.

The rollovers rules do not change just because the participant did not take any action with the check that she did receive.

[Guest AFRICA6796]

Alan's right