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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