participant with RMD unresponsive

[K2retire]

We are the TPA of a large 401(k) plan. One of the former employees has ignored all communication about his RMDs for the past several years. Mail is not being returned and his phone is still in operation with an answering machine message that gives no clues. Because the employer has not been able to reach him by phone, nor had any other response, they do not know if he's disabled (perhaps senile), deceased, doesn't understand that a 401(k) plan cannot be aggregated with IRAs for RMDs, or is just stubborn.

I'm thinking of having the employer instruct the record keeper to process the distribution without the participant's signature. I'd appreciate any feedback about why this should or should not be done.

[MoJo]

I'm thinking of having the employer instruct the record keeper to process the distribution without the participant's signature. I'd appreciate any feedback about why this should or should not be done.

Tis the season, isn't it. My "distribution manager" just was in my office asking the exact same thing (although apparently, we have more than one). It's a qualification requirement. It's a plan requirement. Getting consent, in my humble opinion, is a pro forma requirement to allow for tax withholding elections - BUT NOT TO ELECT TO, OR NOT TO, TAKE THE DISTRIBUTION. Our policy is to process the distribution, marking the paperwork "RMD - FORCE OUT" and cut the check. If it doesn't get cashed, well, then that's another matter - but at least the distribution is processed....

[pmacduff]

also many of the big 401(k) vendors we work with do not require participant signature to process RMDs, only the Trustee or Plan Administrator.

As MoJo mentioned - it is required of the Plan to pay out the RMD, not optional.

[Bird]

RMD stands for REQUIRED minimum distribution. There is no debate about whether or not it must be done; consent is not needed.

[mbozek]

We are the TPA of a large 401(k) plan. One of the former employees has ignored all communication about his RMDs for the past several years. Mail is not being returned and his phone is still in operation with an answering machine message that gives no clues. Because the employer has not been able to reach him by phone, nor had any other response, they do not know if he's disabled (perhaps senile), deceased, doesn't understand that a 401(k) plan cannot be aggregated with IRAs for RMDs, or is just stubborn.

I'm thinking of having the employer instruct the record keeper to process the distribution without the participant's signature. I'd appreciate any feedback about why this should or should not be done.

What does the plan provide regarding commencing RMDs? Does the plan require participant's consent or does plan provide that RMDs commence when Distribution date , 70 1/2 is attained. If the latter, then distributions are to be sent out without consent. I have never seen a plan that required a participant's consent to commence MRDs because commencement of MRDs is a qualfication requirement.

You should send a certified letter return receipt requested to see if some one lives at that address. Also check the SS death registry to see if his SS no is on it.

[K2retire]

The record keeper/custodian is asking for the participant's signature. I'm going to see if I can get them to process it without it.

[mbozek]

The record keeper/custodian is asking for the participant's signature. I'm going to see if I can get them to process it without it.

Record keeper cannot require a signature if MRD must be paid. RK should know that. Dont ask them, tell them to proces the MRD.

[masteff]

Reg § 1.401(a)(9)-8 Q&A-4 (yes, the plan must distribute regardless of consent)