Cleaning up Terminated & Paid-out Participants

So I have this plan with 4 terminated employees who each have a small residual balance due to interest/dividends.  

1¢
$20.03
$8.92
$208.82

For the $208, we will send her the money.... issue a 1099-R.  For the rest, send them the money... is a 1099 needed?  I'd like to just expense it out.  What does everyone do in this case?

We use small distributions toward our fee so the participant will get zero. No 1099. 

If a fee lowers a participant’s distribution to $0.00, is there an information and communication value in generating and sending a Form 1099-R report to show the distribution paid as $0.00?

Or do plans’ administrators use other ways to preserve evidence that the account-closing distribution was provided?

And for the year or quarter-year in which the account becomes $0.00, does one send the participant a final account statement?

Isn't the 1099-R cutoff $10?

But does that rule preclude a payer from volunteering Form 1099-R reports no matter how small the amount?

I'd suspect not - so there could be multiple decisions to make -

a)  can the fees eat the balances under the plan's terms, and

b)  how much is left to pay after *that* and whether a 1099 would be specifically required based on the actual payment value.  (And I think the $10 is an aggregate total, not any one individual payment to the person, right?)

The Instructions state: “File Form 1099-R . . . for each person to whom you have made a designated distribution[,] or are treated as having made a distribution[,] of $10 or more[.]”

Bri, it seems right that the $10 refers to the sum of all payments and deliveries made to the distributee during the reported-on year.

Let’s consider a situation Basically describes, but applying ratherbereading’s mention of a fee resulting in a distribution of $0.00. A participant’s account is $20.03. The plan’s fiduciary had approved the service provider’s $25 distribution-processing fee. On receiving the plan administrator’s instruction to process a distribution, the service provider collects $20.03, leaving $0.00 available to pay the distributee.

Is a 1099-R showing a gross distribution of $0.00 permitted?

1099-Rs show zero quite often simply as a result of being a corrected form, so I suspect nothing's preventing them from being generated almost "voluntarily"...