The Participant may elect to keep the account open and as part of the plan ($5,000 and above account balance).
The Participant is typically not required to take a distribution from the plan until they have attained the age of 70½, at which time Required Minimum Distributions might apply.
If the account remains part of the Plan, the separated from service Participant may elect to take a partial distribution from their account. These distribution types have special tax considerations. For example, if the Participant is less than 59½ years of age, early withdrawal penalties may apply.
Be sure to complete the Participant Separation from Service Checklist. Then follow the steps below:
Step #1 - Participant - Obtain the Form from the Envoy Choice Web Portal
- Log on to the Envoy Web Portal
- Visit www.EnvoyFinancial.com
- At the top of the home page, click Login
- Enter User Id, Password and make sure "Personal Account Holder" is selected as Role
- On the top menu, select Take Money Out > Partial Withdrawal
Step #2 - Participant - Complete the Partial Distribution Authorization Form and Obtain Spousal Consent
Complete and sign the Partial Distribution Authorization Form. Instructions for completion are provided in Section 1 of the form. If you are married, your spouse must also sign the form. The completed form must then be returned to your former employer, the Plan Sponsor.
Step #3 - Plan Sponsor - Review, Authorize and Return the Form to Envoy
Verify that the Partial Distribution Authorization Form is properly signed by both the Participant and their spouse (if applicable). Sign the form as the Employer in Section 7 - Employer Authorization. Save a copy of the form in the Participant's Human Resource file. In the event of a plan audit, a copy of the form will be needed.
Return the completed and fully executed form to Envoy TPA and Recordkeeping for processing. The form can be scanned and emailed as a PDF to PlanSponsor@EnvoyFinancial.com. This is the preferred method. The form can also be mailed to: Envoy Financial, 4194 Royal Pine Drive, Colorado Springs, CO 80920, Attention: Envoy TPA and Recordkeeping.
Step #4 - Envoy - Payment
- Envoy will deduct a distribution fee from the account prior to the distribution.
- Envoy will set up the partial distribution in accordance with the Participant's election.
- 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 partial distribution is typically a taxable event.