RMD

[CJS07]

Have a non-owner who is still working for the Co. (continuous employee since 1980). He took an RMD in 2010 but doesn't want to take one in 2011. Can a participant do that - stop and start? OR Once you start do you have to continue? Tried looking it up and couldn't find anything

Thanks in advance!

[QDROphile]

The only reason for the circumstances are plan provisions that go beyond the legal requirements and provided for the distribution for 2010. Consult the plan for guidance about the current proposition. While you are at it, you might want to reconsider if the plan actually allowed or required the distribution for 2010.

[masteff]

Was this a DC plan? Look to Reg 1.401(a)(9)-2: "Q–6. For purposes of section 401(a)(9)(B), when are distributions considered to have begun to the employee in accordance with section 401(a)(9)(A)(ii)? A–6. (a) General rule. Except as otherwise provided in A–10 of § 1.401(a)(9)–6, distributions are not treated as having begun to the employee in accordance with section 401(a)(9)(A)(ii) until the employee’s required beginning date, without regard to whether payments have been made before that date." So as QDRO said, 2010 was only an MRD if the plan document somehow made it an MRD.

[QDROphile]

Correct. The distribution is not a required distribution. So the first question is what plan provision allowed the amount to be distributed in 2010? That provision should also determine if an amount must or may be distributed in 2011. If the only provision for in-service distributions is for MRDs, then the 2010 distribution is improper.