Retirement Plan Distributions Q&A 194 seems to indicate that, if the plan document allows for it, a non-5% owner who reaches age 70 1/2 while actively employed could make an annual election of whether to take the amount that would be an RMD for a 5% owner, or to defer receiving a benefit to a later date. It also seems to indicate that a participant in this situation could choose to take the distribution one year, defer the next year, and then start distributions again the third year.

In practice, does anyone send elections to take a distribution or defer annually? Or does everyone have participants complete a one-time, irrevocable election to either commence distributions or to defer distributions until termination of employment?

John,

Were you able to resolve this question?

Any other thoughts out there?

I work for a bank that services medium to large size plans. We give the participants the option to choose each year. If a participant does not reply by the given deadline and is still actively employed, we continue whatever choice was made in the prior year.