After-tax rollovers and subsequent distribution

[PMC]

Plans with after-tax employee contributions determine pre-'86 and post '87 amounts in the event a participant receives a distribution of after-tax prior to termination of employment for calculating taxable distributions and what portion of the distribution of after-tax needs to be considered a withdrawal of interest.

Now that after-tax contributions can be rolled over to another plan, is there still the need to ascertain the pre-'87 and post '86 after-tax contributions? Or, given the fact that the after-tax is a "rollover," the accepting plan doesn't have to worry about it? Essentially treat the rollover of after-tax as being made Post-'86 and determine whatever needs to be considered interest under Sec. 72?

[Guest Harry O]

The "accepting" plan doesn't have to worry about. I assume that these contributions would be treated as post-86 money in the accepting plan.

The "distributing" plan still needs to track pre-87 and post-86 monies because not all withdrawals of after-tax contributions will be rolled over.