Termed Plan - trying to pay out remaining participants

[Guest bmurphy]

We have approx. 10-20 individuals in a termed DC plan (company is bankrupt) with balances in excess of $5000. We've sent numerous mailings - the last batch was certified with return receipt requested. We've gotten signed receipts back but a few still have not returned their signed election forms. When we've tried to get a phone number to call them the number is unlisted! At this point it seems we've exhausted all avenues. Since we cannot pay out amounts over $5000 without consent, what other options are available?

[mbozek]

Who told you that??? See IRS 1.411(d)-4 regs. Upon termination a PS plan can be amended to pay lump sum without consent of participant. A MP plan can distribute an annuity contract which provides a J & S annuity and a lump sum option-- which will result in a lower cash value to the participant than making a distribution of a lump sum to the participant. Tell the participants that they have 30 days to make an election before the plan admin. makes the distributions for them. If the participants cannot be located you could always forefit the benefits and distribute assets among the remaining participants.