Legal Holding Time for 401k After Separation of Service

[richardcm]

This is in Washington State.

I left my employer two months ago, and met with an advisor to do a rollover w/ my 401k and plan retirement income. However, my employer is refusing to release the 401k assets because the trustee is claiming that they need to hold on to it until their 2012 compliance filings are completed. The trustee also claims that people typically don't rollover their assets from the plan until a year or so after separation. That sounds crazy to me, as I have retired from the company and I want these assets in an IRA asap.

How long can they legally hold the assets after I've submitted a rollover request? It has been probably 6 weeks now and the trustee doesn't seem to have an urgency to get this done.

Thanks.

 

[cbg]

That is determined by your plan document, which we have not read. Not all plans allow for immediate distribution.

 

[swalsh411]

Request a copy of the plan document. It may be available online.

 

[RedemptionMan]

A lot of times it is also money dependent and if you have over a minimum amount then you can stay vested in your current plan. IMO vested company 401k plans are better....

 

[starting over]

This might be a stupid question, but have you called them directly? I am dealing with a similar situation, I called them & they told me I have a 30 day wait for distribution. It seemed a simple enough question for them to answer.

 

[RedemptionMan]

You have two options, within a set time frame for me it was 90 days, you can pull the whole money for early withdrawal or transfer it to an IRA. This usually has to be done and is a requirement unless you have the minimum amount of funds in the plan to remain vested. At that time you can keep the money where it is.

 

[cbg]

While Redemption Man is not as far off in left field as he usually is, the specific plan document will determine how many options there are and what they are. It is not necessarily limited to early withdrawals and IRA. Few employers still have a forced-withdrawal policy and even those that do are strictly limited by Federal law in when it can be enforced. Your minimum would have to be VERY low before they could force you to take a distribution, EVEN IF their plan has that provision.

I do this for a living. I very much doubt if RM does.

 

[RedemptionMan]

While Redemption Man is not as far off in left field as he usually does, the specific plan document will determine how many options there are and what they are. It is not necessarily limited to early withdrawals and IRA. Few employers still have a forced-withdrawal policy and even those that do are strictly limited by Federal law in when it can be enforced. Your minimum would have to be VERY low before they could force you to take a distribution, EVEN IF their plan has that provision.

I do this for a living. I very much doubt it RM does.

Naw, I do not do straight commission gigs, but I did sleep at a Holiday Inn Express once. So, does that count?

 

[cbg]

Nope. Not this time. But thanks for playing.