Plan amended for in-svc distribution NRA - frozen - but lump sum available

[DW]

Simple question - if a plan is amended to allow in-service distribution (after NRA only, no early in-service commencement) and offers a lump sum, are there any restrictions (beyond high-25 and AFTAP related issues - neither apply here) that would prevent a full time participants reaching NRA (age 65 here) from taking a lump sum?

The amendment to the plan doesn't suggest there are any (as in, the amendment could've easily referenced the LS option as being excluded if it wasn't allowable) and the plan is long frozen, but it does seem a bit odd. I can't think of anything other than seeming odd, though - there's no need to suspend benefits since in service distribution is allowed and the only real exposure to the participant (if they take the lump sum and don't roll it over) is understanding the tax implications of taking a lump sum (already covered in literature). 

[Effen]

Not sure what you think is odd about it?  Fairly standard operating procedure for many plans.  

Curious why you say, "there's no need to suspend benefits since in service distribution is allowed"?  Unless you are giving actuarial increases to the active participants for delay retirement, you would still be required to provide a suspension notice to anyone working beyond NRD.

 

[DW]

The plan provides actuarial increase after NRA for all active and TVs, regardless of the reason for late commencement. 

Thanks for the confirmation - I generally work on larger plans and in-service benefits are only in a few, and even at that, none have lump sums (presumably this would be more common in smaller plans where the original paternalistic intent isn't there).