RMD's

[2muchstress]

Is there a de minimus rule for RMD's like there is for corrective distributions?

I am processing several RMD's where the balance is under $100 and the RMD is just a couple of dollars, or pennies in some cases.

It doesn't seem to make much sense to spend the effort on these.

[imchipbrown]

Can't you distribute the entire balance and be done with them?

[2muchstress]

Assuming that they are no longer employed, then I could distribute the entire balance.

However, if they are employed, they are not required to receive the RMD, but they are require to complete an election to defer the RMD.

Typically, I would send out paperwork notifying them of the RMD amount, plus an election form to defer the RMD until after they separate from service.

I was just curious if anybody knew of a deminimus rule so I wouldn't have to spend any time on it.

[Earl]

I think one is proposed...

[Tom Poje]

there is no so rule I know of.

On the other hand, if you 'accidentally' miss the distribution (I didn't say that), then you can always use the self correction program to correct later.

lets see...percentage of assets involve, number of participants involved, etc....almost sounds like an insignificant problem..you can avoid the problem for what 4 years under those conditions???

but really, the responses given were correct, if the amount is that small and the person terminated, you can always distribute the balance because it will be less than 5000.

If the person is working then you dont have to make the distribution.

I suppose if it is an owner and less than 5000 you run into the one exception

[pmacduff]

2much - doesn't the plan allow for in-service distributions after attainment of NRA? Maybe our plans are unusual, but most of them allow for that and, in your instance, we would try to distribute the minimum + balance and be done with it even if the participant was still employed.