Cashout Limits Applied to Alternate Payee?

[WDIK]

I'm sure the following has been addressed on these boards before, but I didn't find an applicable thread in the 15+ pages of search results.

Semi-hypothetical scenario:

1) Participant has an account balance of $9,000.

2) Under QDRO, 50% of account is segregated for Alternate Payee.

3) Plan allows cashout of benefits under $5,000.

4) Plan allows distributions to Alternate Payees prior to Participant's termination.

5) Alternate Payee wants to defer receipt of account balance.

Can the Plan force the cashout?

Why or why not?

Thanks in advance.

[ccassetty]

My vote would be that the plan can force out the alternate payee provided the plan has utilized this provision for other participants when appropriate. The alternate payee's account balance is separate from the participant's account balance, so I think the applicable balance for forced payout is only the balance in the alternate payee's account.

I'm sure others will let us know if they disagree.

[Harwood]

I agree. If Alternate Payee's account is less than $5,000 - and it is plan policy to force out such balances - then do it.

[J2D2]

I agree. Could you also justify on the grounds that honoring the request to defer, when all other balances under $5,000 are cashed-out, would be providing the alternate payee with an option not available to other participants?