Accrued Benefit After Full Pre-Ret Dist.

[Guest Don N]

Due to administrative error active participant receives entire cash equivalent of his accrued benefit before retirement;participant is still active and it seems to me that his current accrued should be determined by subtracting the current annuity equivalent of the cashout from his accrued benefit calculated as if he hadn't taken the cashout? Any thoughts on this ??

[This message has been edited by Don N (edited 06-06-2000).]

[Guest]

I have more questions than answers. First, how old is this person? Does the Plan have an in-service distribution provision? Was this person eligible to retire? Have you spoken to Plan's ERISA attorney about possible solutions?

It sounds like you could have some serious problems. I would instruct the Plan Administrator to try very hard to get the money back. This can be done through a repayment schedule or, if it was rolled to an IRA, just transfer it back. I don't think reducing future payouts would be at the top of my list of solutions.

How were the taxes haldled? Did they issue a 1099 reflecting the distribution? Did the participant roll-over to IRA?

[Guest Don N]

Thanks for the questions Keith; I've just become involved with this situation and, at this point, the more issues that are exposed the better; I was just thinking from a dollars perspective what would be reasonable assuming all other issues were resolved and if worse case scenario, the money couldn't be recouped.