Withholding on Corrective Distributions

[Gilmore]

For corrective distributions for excess contributions, paid within 2.5 months of plan year end, for 2008 plan years, is the 10% withholding applicable if a W-4P is not completed?

I've heard that yes it is applicable since the distributions are taxable in the year distributed, and I've seen things from service providers saying that withholding within the first 2.5 months (6 months for EACAs) is not applicable.

Thanks!

[Jim Chad]

IMNTBHO I believe that the voluntary withholding rules do apply. This means that 10% is withheld unless the Participant opts out.

Also, I often accept a phone call for instructions on withholding. FWIW

[Gilmore]

Thank you Jim.