In Service Distribution due to DB Plan Termination

[smm]

DB Plan will terminate and employer intends to make the necessary distributions following termination. Can participants who are currently employedreceive a distribution without violating the prohibition on in-service distributions. Ibelieve the answer is yes, but cannot locate any specific authority. Diane Bennett cites an undated 1993 letter from John Riddle which acknowledged a distribution pursuant to a "plan termination", but a wanted something that I can actually stick in the file. Any thoughts?

Thanks.

[mbozek]

Under applicable IRS rules all assets of the plan must be distributed before the plan is deemed terminated. Rev rul 69-157.

[Blinky the 3-eyed Fish]

Plan termination is a distributable event. Logically, if current employees couldn't take a distribution upon plan termination, how would an ongoing company ever terminate a pension plan without firing everyone, including the owner?

There are no successor plan issues either.

[smm]

I completely agree with you. I was simply looking for some documentation respond to a concern that it violates 1.401-1(b)(1)(i).