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A participant terminates in one plan year and receives a distribution of their account balance early in the subsequent year. After the valuation is completed for year of termination an additional contribution is deposited for that participant. What is the rule for determining if this additional contribution can be cashed out or must be combined with the original amount distributed to determine if the $1,000 has been exceeded?

Posted

What does the plan say? The rule you want is in 1.411(a)-11©(3)(i) and applies at the date the distribution commences. Your document may or may not have the same provision.

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