Participants who work part time

[Guest SuzieQNEC]

I understand that generally a participant of retirement age in a pension plan who switches to part time work, and even works <501 hours must still formally terminate employment before receiving benefits. Howbout a participant who terminates and then comes back to work in one of the following scenarios:

1. Already receiving benefits - if working under 501 or 1000 hours, must the participant always stop receiving benefits, even if participant is not accruing new benefits?

2. Not receiving benefits - participant has come back to work and is working under 501 or 1000 hours, can participant start receiving benefits?

What if plan is frozen and the company is under a new employer?

[david rigby]

1. No. It depends on plan provisions.

2. Maybe. Many plans require separation of employment (without regard to hours worked) in order for any benefit commencement. However, plan provisions may incorporate IRC 401(a)(36), thus permitting certain distributions.

Frozen status, or change of sponsor/employer, should not be relevant to the Qs.