Participant Directed Cash Out

Summarize your article content to let people quickly see if their answer is here, and to help search engines find it too.

The Participant may elect to cash out all or part of the account. (Federal and State taxes, as well as distribution expenses, will apply.  In some cases, early withdrawal penalties will apply as well.) 

Step #1 – Participant – Select the Cash Out Option

The Participant must make their payment elections as follows:

1. Log on to the Envoy Choice Web Portal

       Visit www.EnvoyFinancial.com
       At the top of the home page, click Account Log In
       Enter User Id, Password, and make sure “Account Holder” is selected.

2. On the top menu, select Take Money Out > Loans and Withdrawals. 
3. Towards the bottom of the screen, under Termination Distribution, Select Lump-Sum Distribution in the drop-down menu, review the available balance and expense information, and then click Get Started.
4. Review the source balances, instructions, and tax information, and then click Next.
5. Review your personal information, enter missing information, update any incorrect information, and click Next.
6. Select the button for “A lump-sum cash distribution of my vested balance less any income tax withholding” and click Next.
7. Enter your current mailing address (“Country” and “Foreign” may be left blank).
8. From the Payment Method drop-down list, select “Check” or “ACH”.
       If “Check” was selected as the payment method, verify or update the address to which the check should be mailed and click Next.
       If “ACH” was selected as the payment method, enter the following information for the financial institution and then click Next:
            Name(s) on the bank account
            Bank account number
            Sub Account Number (leave blank)
            Bank ABA routing number

9. On the final confirmation screen, review all of your personal information and elections. Click Next to finalize the request.

Step #2 – Participant – Retrieve the Instructions and Request the Form

Once the Participant has submitted their online payment request, the following instructions and forms will be immediately available on the site for their viewing and printing:

• Distribution Authorization Form
• Special Tax Notice Regarding Plan Payments

Step #3 – Participant – Complete Authorization Form and Obtain Spousal Consent

The Participant must complete and sign the Distribution Authorization Form.  If the Participant is married, their spouse must also sign the form.  The completed form must be returned to you, the Plan Sponsor.

Step #4 – Plan Sponsor – Payment Authorization

Upon receipt of the completed and fully executed Distribution Authorization Form, you, as the Plan Sponsor, must take the following actions:

1. Verify that the EWP Participant Distribution Authorization is properly signed by both the Participant and their spouse (if applicable).  Save a copy of this form in the Participant’s Human Resource folder.  In the event of a plan audit, a copy of the form will be needed.

2. Log on to the Envoy Web Portal

       Visit www.EnvoyFinancial.com
       At the top of the home page, click Login
       Enter your User Id, Password and make sure “Sponsor” is selected as your Role

3. On the top menu, select Distributions > Approval.

4. Under the Request Status column, select Approved Request from the drop-down list for the applicable Participant.

5. Enter 100% in the Vested Percentage box if your plan does not include a vesting schedule.  Most plans do not.  Enter the actual Vested Percentage if your plan does include a vesting percentage.

6. Click Save Changes.

Step #5 – Envoy – Payment

• Envoy will deduct a distribution expense of $100 from the account prior to the liquidation.
• Envoy will liquidate the Participant’s account per the Distribution Authorization Form.
• Envoy will direct the payment to the Participant.

Step #6 – Envoy – Tax Reporting

A Form 1099-R will be mailed to the Participant within two weeks of the distribution.  The Participant Directed Cash Out is typically a taxable event.

Special forms and processes apply to certain situations, including deceased Participants, Participants who qualify to receive their distribution in installment payments, and Participants who qualify for tax-favored treatment of Housing Allowance.  Instruct the Participant to contact the Envoy Rollover Desk if they have a distribution request that includes one of these special considerations.