RMD needs election form?

[SSRRS]

Hi,

The owner (active) of a corp took his RMD from his Profit Sharing Plan (his prior year end assets divided by age factor). Since this is an RMD, and he is not electing a benefit etc,  is an executed distribution election form  not required? Thank you.

[CuseFan]

This is not an election, not eligible for rollover, and is required to be paid by the plan for continued qualification, so no forms should be needed. 

[BG5150]

Was 10% withheld for federal taxes?

[C. B. Zeller]

An RMD can be distributed without the participant's consent. However the participant must be given the opportunity to waive the 10% federal income tax withholding.

As a matter of prudence, the plan administrator might want to get the participant to complete a form, if only to ensure that the payment information is correct. If the participant in question is the plan administrator, then this step  might be redundant.

[BG5150]

If there was no withholding, I'd want something in writing, just to chronicle it.

Good thing is if it's a W-4P, then I believe the election is good until revoked.  With W-4P "equivalents" I'm not sure if that election carries forward.

And, if the RMD is distributed without the participant's consent, then, IMHO, the 10% MUST be withheld.

[SSRRS]

Thank you very much BG5150, CUSEFAN, and C.B. Zeller. In this case, the administrator (owner and wife) took the RMDs, and therefore, an election form should not be required based on the above. What if an agent (audit)  is asking for executed distribution election forms for these RMDs?

[C. B. Zeller]

Point them to the section of the plan document that says distributions will commence by the participant's required beginning date, even without the participant's consent.

[SSRRS]

6 minutes ago, C. B. Zeller said:

Point them to the section of the plan document that says distributions will commence by the participant's required beginning date, even without the participant's consent.

C.B. thank you so much!

[Bri]

Surprised nobody bothered to confirm that J&S does not apply to the plan.

[BG5150]

32 minutes ago, Bri said:

Surprised nobody bothered to confirm that J&S does not apply to the plan.

What happens if there's J&S and the participant does not complete the paperwork on time?

[Bri]

Doesn't the plan have to buy a taxable annuity (with survivor benefits) with the single payment otherwise due?

[SSRRS]

On 9/7/2021 at 9:49 AM, Bri said:

Surprised nobody bothered to confirm that J&S does not apply to the plan.

Thank you. However, this is a Profit Sharing Plan, and the only options offered are Lump Sums or partial lump sums.