In-Service Withdrawals in Money Purchase Plans

[Guest BS]

Can a Money Purchase Plan allow for In-Service Withdrawals? If so, can it be withdrawn before age 59 1/2?

[davef]

It's my understanding that the only in-service distributions permitted under a MP plan would be for after-tax employee contributions. Also, if the person is working past NRD, I believe that employer contributions can be withdrawn.

[IRC401]

Planning Idea: Set the NRA at 30.

[AndyH]

In service withdrawals are permitted only at NRA for any pension plan, i.e. MP or DB.

Jim Holland of the IRS said at ASPA last year that the IRS feels it has the authority to interpret NRA based upon facts and circumstances, and if you accept this, a plan with bogus NRA that allows in service distributions could be disqualified. Not a good idea.

[IRC401]

Andy-

I'll take Holland seriously if and when the IRS takes enforcement action against the Bank of America plan.