Schedule H - distribution fees

[SusanKD]

An auditor recently informed me that the fees paid when a participant takes a distribution/rollover should be reported on the Schedule H as a benefit payment and not as a fee. So if the distribution fee is $100 and the participant rollovers $10,000, line 2(e)(1) would have $10,100. Any thoughts on this?

[Andy the Actuary]

In absence of an auditor directing traffic, the lump sum is the benefit payment; the $100 is an expense reported on line i. When you determine TNC, you would certainly include this fee in the TNC, wouldn't you? A benefit distribution is what's specified in the Plan document, which would exclude the $100.

On the other hand, Auditor signs off on 5500, so let it be their call. If found to be inappropriate on review by IRS/DOL, bounce it to the auditor.

[Tom Poje]

so the person also receives a 1099R for $10,100, because that indicates the total amount of distribution as well?