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Posted

Co. A is acquired by Co. B in a stock transaction on 11/01/14. Co. A's 401(k) plan was merged into Co. B's plan

A prior 5% owner of Co. A (Person Z) turned 70.5 on 12/01/14. It is my understanding that since perspn was a 5% owner at some point during 2014 that he should have received a required minimum distribution by 04/01/15, but thta further minimum distributions would not be required as long as he remians employed. Am I correct on that?

Thanks in advance for any guidance.

Posted

As a general rule once a person starts RMDs because they are a 5% owner they don't stop when they stop being a 5% owner. It is in the regs and it seems like if you read the document they follow the regs and they say the same thing.

The only possible twist is the plan merge.

Unless there is some kind of exception for plan mergers the answer is "he has to keep taking RMDs".

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