Min Distrib and Former Key

[Earl]

I have a plan with KEY employee who sold his ownership and is still working for the company. Now he turns 70 1/2. Doesn't want to take Minimum Distributions.

Is there a rule that he has to take minimums if he was key within last 5 years?

I can't find it but I seem to remember it or something like it...

Thanks for any clarification.

[WDIK]

§ 1.401(a)(9)–2, A-2©

© For purposes of section 401(a)(9), a 5-percent owner is an employee who

is a 5-percent owner (as defined in section 416) with respect to the plan year ending in the calendar year in which the employee attains age 70-1⁄2.

[Blinky the 3-eyed Fish]

Although Earl you aren't making up that 5-year rule. I am not sure if EGTRRA changed it, but it did exist at one time.

[mbozek]

the proposed a9 regs applied the 5% rule to any owner with a greater then 5% interest at age 66 or later.