another RMD Error

A non-owner participant was told that since she was over 72 she had to take an RMD for 2022, slightly over $1,000.

Does this mean she has to continue in the future?

Here’s an even better question:

If the plan’s provisions did not require an involuntary distribution, may the plan’s administrator treat it as a mistaken distribution and allow the participant to restore it to the plan and allocate the restoration to the participant’s individual account?

3 hours ago, thepensionmaven said:

A non-owner participant was told that since she was over 72 she had to take an RMD for 2022, slightly over $1,000.

Does this mean she has to continue in the future?

No. It doesn't matter what you call it, it is not an RMD until the first distribution calendar year, and for a non-5% owner, that means the later of the applicable age or the year of retirement. Since they have not retired there is no RMD.

This is assuming that the plan terms do not require participants to commence RMDs earlier than the latest possible date allowed by law.

2 hours ago, Peter Gulia said:

If the plan’s provisions did not require an involuntary distribution, may the plan’s administrator treat it as a mistaken distribution and allow the participant to restore it to the plan and allocate the restoration to the participant’s individual account?

Only if the distribution was actually contrary to the terms of the plan; if the plan permits participants to take amounts in such amount and at such time as they may choose, and the participant affirmatively consented to the distribution, then there is no reason to treat it as a mistake that needs to be corrected.

CuseFan, I reacted to the query, which says an unidentified someone (perhaps the plan’s administrator? or its agent?) “told” a participant “she had to take an RMD for 2022[.]”

If the participant did not truly consent to a distribution, the plan’s administrator mistakenly imposed an involuntary distribution, and the plan’s provisions did not require that imposition, does the participant have a right to demand that the plan accept a repayment and credit her account?