Distributions prior to timing defined in aa

[Guest BAR]

What are the consequences of an plan administrator (employer) authorizing plan distributions earlier than allowed in the plan document? The timing per the adoption agreement is within a reasonable time period after the plan year in which termination of employment occurs. The employer is paying out benefits to participants who terminated in 2001. This is a money purchase plan with a 1000 hour/ last day requirement to receive a contribution so these people will not be receiving any additional contrbutions into the plan.

I have always been a stickler at following the plan document when it comes to the timing of distributions, but it seems like plan sponsors i am currently working with as well as other professionals in the business have become very "flexible" in paying participant out.

Anyone have any insight?

[Belgarath]

The plan has an operational failure. For correction, you can look to the SVP program - I'd have to look, but I think you'd generally correct under APRSC.

[david rigby]

You may also have de facto changed your plan document. If the actual distributions have in any way been discriminatory, get thee to a lawyer.