Guest jetfaninmn Posted June 1, 2005 Posted June 1, 2005 Just a question on how others are handling this plan provision. We have amended a majority of our plans to force payouts under $ 1,000. We have done this to avoid setting up the IRA for the $1,000 to $5,000 balances. In practice, are administrators giving the participant notice (30 days for example) at the time of termination to make a decision on what to do with their funds, or are they just paying them out the full balance and putting the rollover onus on the participant? Just wondering.
rcline46 Posted June 1, 2005 Posted June 1, 2005 For amounts over $200 you MUST give the Notice of Tax Treatment, so you may as well give them the option, ie no force, with a response time of 30 days. After 30 days do the force. Your notice should warn them of the impending force out if no response.
Belgarath Posted June 1, 2005 Posted June 1, 2005 They can't just pay an eligible rollover distribution over 200.00 without a notice. The 402(f) notice requirement still applies. Oops - I see Rcline already replied.
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