QDRO balance for Top Heavy

[Guest bmij]

Plan is currently @ 57% and key employee has a pending qdro. Will the alternate payee benefit be added back to the key employee for top heavy purposes?

[Belgarath]

Probably. I'm not sure this is specifically addressed in the regulations. First, check your plan document, which may specify. If not, I think most people take the interpretation that the alternate payee is treated as a "beneficiary" for the purposes of adding a QDRO distribution back in for considering top heavy status.

[SheilaD]

Probably. I'm not sure this is specifically addressed in the regulations. First, check your plan document, which may specify. If not, I think most people take the interpretation that the alternate payee is treated as a "beneficiary" for the purposes of adding a QDRO distribution back in for considering top heavy status.

I did a lot of research into this in 2006 as I had this situation. In addition the ex-wife had an account balance attributable to her own service. My conculsion was that her portion as a former key was excluded. The amount attributable to the QDRO counted in the tests (and had to be added back in) until 5 years after it was distributed. At this distance in time - I'd have to go to storage to review my notes to say exactly how I am to that conclusion.

Hope it helps.

[Guest bmij]

Thank you.