Force out distribution timing

[Kimberly S]

My former employer (known for being somewhat aggressive) taught that when forcing out a participant the distribution had to be processed after 30 days, but before 90 days (pre PPA06) had passed from giving the distribution notice. My new employer says that there is a special rule that requires that force outs to be processed only after the 90 (now 180) days have passed. I have not been able to find anything that says that force out rules are different than regular distributions as far as the notice requirements. Have I missed something?

[J Simmons]

My former employer (known for being somewhat aggressive) taught that when forcing out a participant the distribution had to be processed after 30 days, but before 90 days (pre PPA06) had passed from giving the distribution notice. My new employer says that there is a special rule that requires that force outs to be processed only after the 90 (now 180) days have passed. I have not been able to find anything that says that force out rules are different than regular distributions as far as the notice requirements. Have I missed something?

Kim,

I agree with your former (aggressive) employer. Once 30 days and the proposed distribution date specified in the distribution notice have passed, you can proceed with the force out.

[Kimberly S]

Would you also agree that after the expiration of the notice period you must re-notice before processing?

[J Simmons]

I would agree that if no payout has in fact been made within 180 days of notice of when given to a former employee after 2006 (or 90 days of notices given before 2007), you must re-notice before you can then do any payouts.

However, if the 30 days runs out (and the date set in the distribution notice for proposed distribution date passes) with no response from the participant for whom forceout is applicable, you don't have to re-notice so long as the first payout is made no later than the 180th day (or 90th, as the case may be) after notice was provided.