Kirkland Alert Kirkland & Ellis LLP

Employee Benefits Alert - February 2005

This alert follows up on new distribution rules for qualified plans. Our October alert described that involuntary distributions in excess of $1,000 must be rolled over to an individual retirement account (“IRA”) when a terminated participant fails to elect a distribution and summarized the Department of Labor (“DOL”) final regulations providing a safe harbor for plan sponsors.  The mandatory rollover rules are effective for qualified plan distributions beginning March 28, 2005.  IRS Notice 2005-5 was recently issued and provides IRS guidance on implementin