Write off of small balances

95% of our our plan clients use record keeping platforms fortunately.  But there are those with brokerage accounts.  We normally charge $125 for a distribution (we provide election form and tax notice, letter to plan sponsor to request the funds from the custodian, we write the distribution checks or issue ACH, withhold taxes and pay through EFTPS and do the 1099-R.  We charge more for EFTPS, each 1099-R and 945 if needed.  Very time intensive obviously.  We are struggling with residual balances that come in once someone's account has been closed.   We provide the fee disclosure each year as participants pay the $125.  We had a policy of reducing our fee so as to be no more than 10% of the distribution - didn't want any DOL attention.  So I'm ready to write off balances less than our fee.  I guess those funds would go into an unallocated suspense account.  Curious what others do.

If they're legitimately assessed fees, the money should leave the plan to arrive at your office.  (Why use a suspense account for it, other than maybe to collect them all at once and write one bigger check at the same time for you?)