Benefits Handbook

If you elect to have your dividends paid out, they will be taxable in the year in which they are distributed. Although dividend payouts are taxable, they are not subject to tax withholding. Any dividend payments will be reported on the form prescribed by the IRS which will be mailed to you by January 31 of the year following the year in which the dividend is paid.

Dividend payouts from the employee stock ownership feature of the Plan do not qualify for the special lower tax rate available under the Jobs and Growth Tax Relief Reconciliation Act of 2003 for certain dividends paid on stock held outside the Plan. Therefore, under current law, dividends distributed from the MMC Stock Fund will continue to be taxable at ordinary income rates. (If you request a distribution of Marsh & McLennan Companies stock after you leave the Company, dividends paid on those shares after distribution from the Plan will qualify for capital gains tax treatment.) You may want to consult with a tax professional.

You are responsible for paying any taxes due on your dividend payments. The dividend payment is not subject to the additional 10% Federal early withdrawal tax that the IRS imposes on taxable withdrawals or distributions from the Plan before a participant attains age 59-1/2.