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Module 9a

Retirement and Estate Planning > Planning for a Secure Retirement > Module 9a

Module 9a: Lump Sum Distribution

Goal: to understand lump sum distributions.

To be considered a "lump sum distribution" for tax purposes, money must come from an Internal Revenue Service (IRS) qualified retirement plan. Some examples would be a 401(k) plan, profit-sharing plan, or other approved pension plan.

A lump sum must be payable due to separation from service, death, disability, or after you have reached age 59 1/2. In simpler terms, you could be eligible to e a lump sum distribution at job change, layoff, or retirement. You must receive the entire amount within one tax year.

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