pmacduff Posted November 7, 2012 Posted November 7, 2012 Profit sharing 401(k) Plan: owner has retired but left his balance in the Plan. He is taking the required minimum distributions. Is he required to take his entire balance out of the Plan because he is no longer working or can he leave it in and continue to take minimums? Someone in our office thought that he has to take the balance out because he is over the NRA of 65. I thought perhaps that only applies to Defined benefit plans?
masteff Posted November 7, 2012 Posted November 7, 2012 This is the ultimate "what does your plan say" question. Of course, MRDs are a form of payment so he is technically in payment if that makes a difference in how you read your plan. Generally speaking, if the plan allows to defer payment to a later time (but not later than MRD) then he can leave it in the plan. Kurt Vonnegut: 'To be is to do'-Socrates 'To do is to be'-Jean-Paul Sartre 'Do be do be do'-Frank Sinatra
BG5150 Posted November 7, 2012 Posted November 7, 2012 Is the balance over or under the "cashout" threshold of the plan? QKA, QPA, CPC, ERPATwo wrongs don't make a right, but three rights make a left.
GMK Posted November 7, 2012 Posted November 7, 2012 This is the ultimate "what does your plan say" question.Generally speaking, if the plan allows to defer payment to a later time (but not later than MRD) then he can leave it in the plan. This is your answer. Just find out what the plan doc allows/requires.
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