A small company terminated its plan in early 2008 and distributed all benefits to the 3 owners, who were the only participants in the plan. None of these owners rolled the distributions over; thus they are taxable in 2008. However, one of the owners turned age 55 during 2008 (the others are over 59 1/2). Is this owner subject to the 10% excise tax, or is he considered "separated from service" for purposes of IRC 72(t)?
Any replies would be appreciated, thanks!