MMC Benefits Handbook
How the Benefit Is Paid
If your account balance is $1,000 (includes your Roth 401(k) balance) or less, your account balance will be distributed to your Beneficiary automatically, and applicable taxes will be withheld.
If your account balance is more than $1,000 (includes your Roth 401(k) balance), your beneficiary may request a distribution or leave the account in the Plan. The maximum period over which your beneficiary may defer depends on whether or not your beneficiary is your surviving spouse.
If your beneficiary is your surviving spouse, he or she may:
  • elect a lump sum distribution, which he or she may direct as a rollover into his or her own traditional IRA, Roth IRA or employer's tax-qualified plan, at any time up until April 1st following the calendar year in which you (not your spousal beneficiary) would have attained age 72 (if you were born after June 30, 1949) or age 70-1/2 (if you were born before July 1, 1949).
  • elect Installment distributions over a period of years not to exceed your spouse's life expectancy, beginning no later than April 1st following the calendar year in which you (not your spousal beneficiary) would have attained age 72 (if you were born after June 30, 1949) or age 70-1/2 (if you were born before July 1, 1949).
  • elect a lump sum distribution, which he or she may direct as a rollover into his or her own traditional IRA, Roth IRA or employer's tax-qualified plan, on a percentage of the account balance and installment distributions on the remainder, subject to the time frames above.
If your beneficiary is not your surviving spouse, he or she may:
  • elect a lump sum distribution, which he or she may direct as a rollover into a traditional IRA or Roth IRA at any time (i) within five years of your death, if the date of death was prior to January 1, 2020 or if the beneficiary is a non-individual beneficiary, or (ii) within ten years of your death, if the date of death was after December 31, 2019 (for individual beneficiaries), or
  • elect installment distributions, beginning no later than 11 months after the election has been filed, and ending within (i) five years of your death if the date of death was prior to January 1, 2020 or if the beneficiary is a non-individual beneficiary or (ii) within ten years following your death, if the date of death was after December 31, 2019 (for individual beneficiaries).
If you were already receiving installments before your death, your beneficiary may elect any of the following payment options upon your death:
  • Lump sum payment payable to your beneficiary;
  • Lump sum payment payable to your beneficiary's inherited IRA with a rollover institution; or
  • Installment distributions as follows:
    • If your date of death was after December 31, 2019, an individual beneficiary can elect installments at any frequency (monthly, quarterly, semi-annual or annual) ending no later than 10 years following the date of your death. The beneficiary would make a separate installment election rather than continuing your original installments.
    • If your date of death was before January 1, 2020, an individual beneficiary can continue installments over the period you originally elected. New installment elections would not be permitted.
    • If you have a non-individual beneficiary, the beneficiary can continue installments over the period that you originally elected. However, if you died before April 1st of the calendar year following the calendar year in which you would have attained age 72 (if you were born after June 30, 1949) or age 70-1/2 (if you were born before July 1, 1949), these installments will end no later than 5 years following the date of your death. New installment elections would not be permitted.
If your beneficiary does not request an immediate distribution of your account, the account balance will continue to be affected by the investment performance of the investment options elected for the account.
While your account remains in the Plan, your beneficiary can:
  • reallocate the balance of your account among different investment options.
  • substitute one investment option for another (a "fund-to-fund" transfer).
  • request a distribution.
As long as your beneficiary maintains a balance in the Plan, your beneficiary will need to call HR Services at +1 866 374 2662 to report any address changes so the account statements are properly directed.