Withdrawals vss. distributions

[Jim Chad]

I use words "withdrawal" and "distribution" interchangeably; as if they mean the same thing. But sometimes, I hear people use them as if they have very different meanings. Can anyone explain the difference to me?

[401king]

I would consider a distribution to be something that is only a taxable event for the participant. Whereas a withdrawal may include fees & expenses, loans, etc. With that said, I use them interchangeably as well if a client begins the conversation with, "I need to make a withdrawal."

[masteff]

To me, nearly any outflow of money is a distribution. Whereas a withdrawal is a participant initiated distribution. http://www.merriam-webster.com/dictionary/withdrawal

And some people get odd terminology from their own plan docs or from their trustee's procedures.