411(d)(6) - change of timing of a distribution

[EGB]

Facts: 401(k) plan with lump sums and installments - payable "as soon as administratively feasible" upon termination of employment. Plan is amended to state that

payments will be made no sooner than 145 days after termination of employment. It seems to me that this could be a violation of Reg. section 1.411(d)-4. Although the regulations allow a change in timing of distribution by up to "two months" for distributions after termination of employment (6 months for distributions during employment)(see Reg. Q&A-2(B)(2)(ix)), the 145 days could exceed the de minimus rule. Of course, "as soon as administratively feasible" is subjective and differs among plans based on number of participants, valuation methods, etc.. Any thoughts? I am being too picky and conservative? Would anyone else be concerned about making this change? (By the way, they have already done the amendment).

[Ervin Barham]

Yes, I would, but I tend to be very literal when it comes to those types of things. There may be others who would be willing to go with that much leeway, arguing that 145 days is "administratively feasible".

If this is a daily plan, it's going to be hard to argue that one.