Qualified Plan Distributions

DEFINITION—

Amounts paid to plan participants from a qualified plan are called distributions.

Distributions may be nonperiodic, such as lump-sum distributions, or periodic, such as

annuity payments. Also, certain loans may be treated as distributions.

Required Distributions Take a look at Section (a)(9) at 401(a)(9)

A qualified plan must provide that each participant will either:

• Receive his or her entire interest (benefits) in the plan by the required beginning date

(defined later), or

• Begin receiving regular periodic distributions by the required beginning date in annual

amounts calculated to distribute the participant’s entire interest (benefits) over his or her

life expectancy or over the joint life expectancy of the participant and the designated

beneficiary (or over a shorter period).

These distribution rules apply individually to each qualified plan. You cannot satisfy the

requirement for one plan by taking a distribution from another. The plan must provide that

these rules override any inconsistent distribution options previously offered.

Related Topics:

Eligible rollover Distribution

Lump Sum Distribution

Minimum Distribution

Minimum Distribution Incidental Benefit Requirement

Rollover