Distributions During Employment
(1)De minimis distribution. A de minimis distribution is an in-service distribution of the entire balance of a small account before the date a participant has a severance of employment. A de minimis distribution may be made if all of the following conditions are satisfied:
(a)No prior de minimis distribution was made to the participant;
(b)The total balance of the participant’s account(s) within the Deferred Compensation Program do(es) not exceed the limitations in the Internal Revenue Code Section (IRC) 457(e)(9)(A), which is $5,000;
(c)Participant has not made any contributions to the Deferred Compensation Program in the two-year period before the date of distribution; and
(d)Participant has submitted an application for a de minimis distribution on forms provided by, or other methods approved by the Deferred Compensation Program. No distribution will be paid unless a complete application is filed with, and approved by, the Deferred Compensation Program.
(2)Unforeseeable emergency withdrawal. An unforeseeable emergency withdrawal is an in-service distribution made to a participant due to an unforeseeable emergency. This withdrawal may be made before the date a participant has a severance of employment and as defined in OAR 459-050-0150 (Unforeseeable Emergency Withdrawal). A participant must apply for an unforeseeable emergency withdrawal using forms provided by, or other methods approved by, the Deferred Compensation Program as provided for in OAR 459-050-0150 (Unforeseeable Emergency Withdrawal)(4).
(3)Military distribution. A participant is treated as having been severed from employment during any period the participant is performing service in the uniformed services while on active duty for a period of more than 30 days for the purposes of the limitation on in-service distributions. For purposes of this rule, “uniformed services” has the same meaning as given in OAR 459-050-0072 (Military Leave Catch-up). This section applies to distributions made on or after January 1, 2009.
(4)Trustee-to-Trustee Transfers. A Trustee-to-Trustee Transfer for the purpose of purchasing permissive service credit as described in Code Section 415(n) or a Trustee-to-Trustee Transfer that meets the requirements of 26 CFR 1.457.10(b)(4) may be made while a participant is still employed.
(5)Funds available for in-service distribution. Funds contributed to the Deferred Compensation Program, and earnings on those contributions may be distributed in a de minimis distribution or unforeseeable emergency withdrawal. Any funds directly transferred or rolled over to the Deferred Compensation Program from any plan other than an IRC 457 deferred compensation plan may not be distributed for a de minimis distribution or an unforeseeable emergency withdrawal.
(6)Prohibitions on elective deferrals after an in-service distribution. A participant who receives a de minimis distribution, an unforeseeable emergency withdrawal, or a military distribution may not make elective deferrals and employee contributions to the Deferred Compensation Program for a period of six consecutive months from the date of distribution.
(7)Notwithstanding any other sections of this rule, a participant who self-certifies through a process provided by the Deferred Compensation Program as a “qualified individual” as that term is defined in the Coronavirus Aid, Relief, and Economic Security Act of 2020, may take an in-service distribution of no more than $100,000 during calendar year 2020.
(a)A qualified individual means an individual:
(A)Who is diagnosed with the virus SARS-CoV-2 or with coronavirus disease 2019 (COVID-19) by a test approved by the Centers for Disease Control and Prevention;
(B)Whose spouse or dependent (as defined in section 152 of the Internal Revenue Code of 1986) is diagnosed with such virus or disease by such a test; or
(C)Who experiences adverse financial consequences as a result of being quarantined, being furloughed or laid off or having work hours reduced due to such virus or disease, being unable to work due to lack of child care due to such virus or disease, closing or reducing hours of a business owned or operated by the individual due to such virus or disease, or other factors as determined by the Secretary of the Treasury (or the Secretary’s delegate).
(b)A distribution taken under this section, or any portion thereof, may be redeposited by the plan participant back into the participant’s Deferred Compensation Account within three years beginning on the day after the date of the withdrawal.
Rule 459-050-0075 — Distributions During Employment,