In Plan Roth Rollovers In Service Withdrawals

We have a plan amending  to add the profit sharing/nonelective contribution account as eligible for in plan Roth Rollovers.  This will apply to both distributable and non-distributable amounts.  The plan only permits a participant to withdraw this money in service if they have reached the plans NRA, which is 65 plus 5 years of participation.  This in service withdrawal provision should be carried over for any profit sharing amount that is covered to a Roth Rollover.  I am being told that for amendment purposes, we can only have age 65 and not the 5 year requirement as the inservice withdrawal provision.  I am not seeing this restriction in the plan document.  Is this a regulatory restriction on in plan Roth Rollovers?  Any insight is greatly appreciated.

I’m not aware of anything that changes the distributable characteristics of the money source due to a Roth conversion. 
 

Someone needs to cite a source. 

On 1/24/2025 at 9:08 PM, Bill Presson said:

I’m not aware of anything that changes the distributable characteristics of the money source due to a Roth conversion. 
 

Someone needs to cite a source. 

I don't have a cite handy. But you are right. Otherwise, participants could bypass the triggering event requirements via an in-plan conversion.

Notice 2013-74 Q&A-3

Quote

Q-3. Is an amount rolled over to an employee’s designated Roth account pursuant to § 402A(c)(4)(E) subject to any distribution restrictions after the in-plan Roth rollover?

A-3. Yes. If an amount is rolled over to a designated Roth account pursuant to § 402A(c)(4)(E), then, notwithstanding Revenue Ruling 2004-12, the amount rolled over and applicable earnings remain subject to the distribution restrictions that were applicable to the amount before the in-plan Roth rollover. Thus, for example, if a § 401(k) plan participant who has not had a severance from employment makes an in-plan Roth rollover of an amount from the participant’s pre-tax elective deferral account prior to age 59½, that amount and applicable earnings may not be distributed from the plan prior to attainment of age 59½ or the occurrence of another event described in § 401(k)(2)(B).

 Thank you to all that responded.  It turned out there was a misunderstanding on a coworkers part that while age 65 is generally the max age permitted for NRA, you can add a max 5 year service or participation requirement.  That has been resolved.