• New Guidance on the Automatic Rollover Rules for Mandatory Distributions
  • March 25, 2005 | Authors: David M. Glaser; Bernard F. O'Hare
  • Law Firm: Patterson Belknap Webb & Tyler LLP - New York Office
  • As you may be aware, new rules regarding cash-outs of small distributions will become effective on March 28, 2005. Under the new rules, if a qualified pension plan (including for these purposes 401(k) plans, 403(b) plans and governmental 457(b) plans) provides for the automatic cash-out of benefits valued over $1,000 and less than or equal to $5,000, those amounts will be required to be rolled over into IRAs established by the plan fiduciary, unless the recipients elect otherwise.