Distribution option based on 5310

[Guest Sadie]

There is a question on the 5310 that asks if the distribution will be made in any other form beside cash. This question has been answered "no" (so only cash distribution) on a termination of the plan. We have received a determination letter based on the information on this 5310. A IRS reviewer has said that this question has no relevance and the plan should still follow the terms of the plan and allow in kind distribution if it is in the document. I would like to find out my colleague's opinion about that.

[Bird]

I once answered the question "yes" and was asked about it; told them we might distribute securities in-kind. They said those are still considered cash distributions and told us to change the answer to "no."

I'm not sure if it only "counts" when you have assets for which FMV is not readily determinable or what.