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lump sum distribution” less the “minimum distribution allowance.”
Sec. 402(d)(1)(B).
In order to qualify for forward averaging under section
402(d)(1), the distribution must be a lump-sum distribution
within the meaning of section 402(d)(4)(A), and the recipient
must satisfy the requirements of section 402(d)(4)(B). Section
402(d)(4) defines lump-sum distribution, in pertinent part, as
follows:
(A) Lump sum distribution.-–For purposes of this
section and section 403, the term “lump sum
distribution” means the distribution or payment within
1 taxable year of the recipient of the balance to the
credit of an employee which becomes payable to the
recipient--
(i) on account of the employee’s death,
(ii) after the employee attains age 59�,
(iii) on account of the employee’s separation
from the service, or
(iv) after the employee has become disabled
(within the meaning of section 72(m)(7)),
from a trust which forms a part of a plan described in
section 401(a) and which is exempt from tax under
section 501 or from a plan described in section 403(a).
Clause (iii) of this subparagraph shall be applied only
with respect to an individual who is an employee
without regard to section 401(c)(1), and clause (iv)
shall be applied only with respect to an employee
within the meaning of section 401(c)(1). * * *
Section 402(d)(4)(B) provides that the separate tax authorized
by section 402(d)(1)(A) shall apply to a lump-sum distribution
with respect to an employee only if the amount is received on or
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Last modified: May 25, 2011