Distributions Subject To Code Section 417 Sample Clauses
The "Distributions Subject To Code Section 417" clause defines how retirement plan distributions must comply with the spousal consent and joint and survivor annuity requirements set forth in Section 417 of the Internal Revenue Code. In practice, this means that certain distributions from qualified retirement plans, such as pensions, cannot be made to a participant without first obtaining written consent from the participant's spouse, and the default form of payment is often a joint and survivor annuity unless otherwise elected. This clause ensures that both the participant and their spouse are protected in the distribution of retirement benefits, preventing unintended loss of spousal rights and promoting compliance with federal law.
Distributions Subject To Code Section 417. If payments in the form of a Qualified Joint and Survivor Annuity are required with regard to a Participant, the rules in this sub-paragraph 6.7(a) are substituted for the rule in the first sentence of paragraph 6.4(b). If the value of the Participant’s Vested Account Balance exceeds $5,000 (or at the time of any distribution (1) in Plan Years beginning before August 6, 1997, exceeded $3,500 or (2) in Plan Years beginning after August 5, 1997, exceeded $5,000), and the account balance is immediately distributable, the Participant and the Participant’s Spouse (or where either the Participant or the Spouse has died, the survivor) must consent to any distribution of such account balance.