Cash-out rules

[Guest Patkelley007]

A DC plan has adopted cash-out forfeiture provisions, and as required the plan allows repayment of distributions to restore forfeited benefits.

The question is, upon re-hire, is any notice required to be provided to the employee about their ability to buy-back the forfeited benefit by repaying the cash-out distribution? The regs at 1.411(a)-7(d) do not contain a notice requirement, and I've checked a few reference manuals that do not speak to any required notice. However, I'm working with an accountant who believes a notice is required. SUch a notice would seem fair (especially since this is not described well in the SPD).

If anyone is aware of any authorities regarding participant notices in this situation, I would appreciate any information you can provide. Thanks.

[Guest Pensions in Paradise]

No notice is required. If the accountant feels otherwise, have him/her provide you with a cite.

Of course, there is nothing to prevent you from providing such a notice if you so desire.

[david rigby]

Of course, there is nothing to prevent you from providing such a notice if you so desire.

... providing the plan administrator does so on a non-discriminatory basis.