Lump Sum Threshold

[Just Me]

Does anyone see a problem with a nonqualified plan subject to 409A providing that if the participant's account balance is less than some fixed amount (say, $25,000) at the distribution date, then it's a lump sum, but if it's at or above that amount, it will be paid in accordance with the participant's (timely made) form and timing election, such as a 10 year installment payment? [This is not intended to fit within the discretionary de minimis rule.]

[XTitan]

Personally, I don't, but Treasury seems to. For now, it's ok. See Notice 2007-78 on limited cashouts.

[Just Me]

Thanks. Somehow, I knew we could do this, but wasn't sure where the guidance was (clearly not in the final regulations).