Distributions from Your 401(k) at Retirement
- Introduction
- Lump-Sum Distribution
- Annuity Distribution
- Rollover to a Traditional IRA
- The Roth IRA - How Does It Fit In?
- Rollover to another Retirement Plan
- Mandatory Withdrawals
Lump-Sum Distribution
A lump-sum distribution is just what it sounds like—you take a distribution of all the money in your 401(k) plan in one lump sum. You will qualify to take a lump-sum distribution if you meet the following requirements:
- The distribution is payable on account of death, attainment of age 59½, or separation from service.
- Your entire plan balance is paid out.
- The distribution is made all in one taxable year of the recipient.
You will have two choices if you go this route.
- You can roll over all or part of it into a traditional IRA or other retirement plan and defer paying income tax; or
- You can pay income tax on the money you keep.
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Important information about procedures for opening a new account
To help the government fight the funding of Terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account.
What this means to you: When you open an account, we will ask you for your name, address, date of birth and other information that will allow us to identify you. We may also ask to see your driver's license or other identifying documents.
Investment products are offered through Osaic Institutions, Inc., Member FINRA/SIPC. Insurance products offered through Osaic Institutions, Inc.