R. Butler Posted September 4, 2008 Posted September 4, 2008 Participant has a whole life policy inside of a retirement plan. Participant's balance is currently $350,000. Cumulative contributions are $300,000. Participant is going to withdrawal $300,000. My only question is when appyling the incidental benefit rule can plan sponsor still base the 50% limit on $300,000 or is the limit reduced due to the distribution? My understanding is that the limit can still be based on the $300,000, but wanted to double check. Thanks in advance for any guidance.
Bird Posted September 4, 2008 Posted September 4, 2008 The test seems to be on "aggregate" contributions, which I would not read as "net," so I think it's ok. Ed Snyder
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