MarZDoates Posted October 31, 2005 Posted October 31, 2005 We have a 401(k) plan that is being audited by the IRS for the 2002 plan year. We have several participants that terminated employment in 2005 and will be due a distribution after the end of the plan year. If the audit is not finalized, is there any reason we should not go ahead and distribute assets to terminated participants? QPA, QKA
JanetM Posted October 31, 2005 Posted October 31, 2005 Is the plan is danger of being disqualified? Unless there is possibility of that I don't see why you should not follow your plan doc. JanetM CPA, MBA
MarZDoates Posted October 31, 2005 Author Posted October 31, 2005 We do not foresee disqualification, but could be some penalties/excise taxes imposed on late deferrals. QPA, QKA
JanetM Posted October 31, 2005 Posted October 31, 2005 I would make the distributions. Especially if that is how your plan is written. JanetM CPA, MBA
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