RMD

[Guest jama]

A non-owner who is still working turned 701/2 in 2004 and elected to start taking her RMD. Can she now stop? I can't find the answer to this question anywhere.

Thanks

[Kevin C]

It depends on what the plan document says. They are not required to allow non-5% owners to delay RMD's while still employed. You said she elected to receive her initial RMD. Did that election say anything about whether future payments could be suspended if still employed?

It may also depend on how the participant's distribution is being paid. Did the participant elect to receive installment or annuity payments starting in 2004?

[Guest jama]

Kevin,

The plan document does allow non-owner employees to postpone minimum distributions until they quit working. The election form that she filled out to start her RMD is silent on the subject. The only distribution she taked is her minimum. I can't fathom that she can't suspend the distributions now but I can't prove my theory.

Thanks for your help!

[BG5150]

I would think that she could stop them as long as the original distribution scheme was not a series of substantially equal payments determined on the life expectancy of the client (we used to call that a SEPDOLEC in my old job).