Recovery of Small Overpayments

[Guest ircreader]

If a participant is overpaid by $145, can we collect only $45?

Revenue Procedure 2003-44, Section 6(5)© states that generally for submissions under VCP, the plan sponsor is not required to seek the return of an overpayment of $100 or less but must notify the participant or beneficiary that it's not eligible for favorable tax treatment (rollover).

Although we aren't under the VCP, in practice we don't collect overpayments of $100 or less but do inform the participant re the fact that it's not eligible for favorable tax treatment.

So can we collect only the amount over $100? I don't think it's clear so I wondered what everyone else thinks?

[QDROphile]

Please explain the logic of trying to collect only $45 of $100 if you are going to bother to try to collect at all.