Qualified Retirement Plan (QRP) and Keogh Distribution Request … · 2010. 3. 24. · A. From a...

of 6

©2008 Charles Schwab & Co., Inc. (“Schwab”). All rights reserved. Member SIPC.Schwab Institutional® is a division of Schwab. FTA 05550 (1008-1024) APP35811-02 (11/08)

Qualified Retirement Plan (QRP) and Keogh Distribution Request Form

Investment Advisor (“IA”) Information (This portion to be completed by IA.)

IA Firm Name (please print): __________________________________________________________________________________________________________

IA Master Account Number: _____________________________________________________________ Service Team: ________________________________

To the Plan Administrator:

•PleasecompleteSections2and8ofthisformbeforeprovidingittothePlanParticipanttorequestapayout.

•AftertheParticipantcompletes,signsandreturnsthisformtoyou,signinSection9AtoauthorizeSchwabtoprocessthedistribution.

To the Participant:

•PleasecarefullyreadtheQualifiedRetirementPlan(QRP)andKeoghDistributionNoticeincludedwiththisform.ThisNoticecontainsimportantinformationaboutyourdistribution.KeeptheNoticeforyourrecords.

•CompleteandsignthisformtoreceiveadistributionfromyourSchwabQRPorKeoghaccount.Ifyouaremarried,yourspousemayalsoberequiredtosignthisrequestinthepresenceofanotarypublic.ReturnthecompletedformtoyourPlanAdministrator.

1. Account Information (required)

Married Unmarried LegallySeparatedAccount Number Participant’sSocialSecurityNumber Marital Status

Participant First Name Middle Last

2. Plan Information (required)

NameofPlanAdministrator(Employer,unlessaPlanAdministratorwasappointedonAdoptionAgreement.) EmployerIdentificationNumber(EIN)

QRP/KeoghMoneyPurchasePensionPlan QRP/Keogh Profit Sharing Plan %TypeofAccount Participant’s Vested Account Percentage (If less than 100%, complete Section 8.)

IsthePlansubjecttotheQualifiedJointandSurvivorAnnuity(orSingleLifeAnnuity)requirements?* Yes No

*Annuity Disclosure:YourSchwabQRPorKeoghissubjecttotheQualifiedJointandSurvivorAnnuity(orSingleLifeAnnuity)requirementsifiteitherisaMoneyPurchasePensionPlan,isaProfitSharingPlanthathasannuitiesasthenormalformofbenefit(seeyourBasicPlanDocument),orhasreceived assets for this Participant account from another plan, which has annuities as the normal form of benefit.

3. Distribution Reason(CompleteoneoptionfromSectionsA–Bbelow.)

A. From a QRP Profit Sharing, QRP Money Purchase Pension or Keogh Plan Normal Distribution (Select for distribution if Participant is age 65 or older.)

Iamage70½orolderandIamtakingthisdistributionasmyRequiredMinimumDistribution(RMD).

Choose one:

IwantSchwabtocalculatemyRMD.

ThecalculationwillusuallybemadeusingtheIRSUniformLifetimetable;however,ifyoursolebeneficiaryisyourspouseandyourspouseismorethan10yearsyoungerthanyou,thentheJointLifetimetablewillbeused.Completethefollowing:

1. Your date of birth: ________________ (mm/dd/yyyy)

2.Isyourspouseyoursolebeneficiary? Yes No IfyouansweredYes,completenumbers3and4below.IfyouansweredNo,theUniformLifetimetablewillbeused,andyoucanskiptoSection4.

3. Your spouse’s date of birth: ________________ (mm/dd/yyyy)

4. Your spouse’s name: ____________________________________________________________________

IhavecalculatedmyownRMD.

Distribution Due to Termination of Employment

Disability Distribution(Selectfordistributionduetodisabilityasdescribedinthe“Definitions”sectionoftheBasicPlanDocument.)

Plan Termination (BeforeterminatingyourPlan,yourPlanDocumentsmustbeincompliancewithallcurrenttaxlaws.Werecommendthatyouconsultwithyourtaxadvisor.)

ForCharlesSchwabUseOnly

Account Number

WB

http://sistaging.schwab.com/transact/FormHelpController?helpid=6260

of 6


Distribution Due to Death of Participant (Attach the following documents and complete the recipient information requested below.)

1.Certifiedcopyofthedeathcertificate

2.IRSFormW-9,iftransferringassetsoutsideofSchwab

3.Iftherearemultiplebeneficiaries,eachbeneficiarymustcompleteaseparateSchwabQualifiedRetirementPlan(QRP)andKeoghDistributionRequest Form.

4. IfyouareanonresidentalienwithoutaSocialSecuritynumber,youwillalsoneedtoattachacompletedIRSFormW-8BENandacertifiedcopyofyourpassport.

Note:Otherdocumentsmayberequired.Ifthedecedentwasover70½ and had not withdrawn his or her Required Minimum Distribution (RMD) fortheyearofdeath,asbeneficiary,youmustwithdrawtheamountbeforetheassetscanberolledovertoanIRA.ContactyourInvestmentAdvisortodiscussyourindividualsituation.

Recipient First Name Middle Last Relationship to Participant

HomeStreetAddress(noP.O.boxes,please) City State Zip Code

SocialSecurity/TaxIDNumber DateofBirth(mm/dd/yyyy) Home Telephone Number BusinessTelephoneNumber Cellular Telephone Number

USA Other Other USA OtherCountry(ies)ofCitizenship CountryofLegalResidence

Distribution Due to Qualified Domestic Relations Order (QDRO) (Attach the following documents and complete the recipient information requested below.)

1. Final QDRO

2. Schwab IRA Application (if interest is to be rolled over to a new IRA at Schwab)

3.IRSFormW-9,iftransferringassetsoutsideofSchwab

Note: Otherdocumentsmayberequired.ContactyourInvestmentAdvisortodiscussyourindividualsituation.

Recipient First Name Middle Last Relationship to Participant

HomeStreetAddress(noP.O.boxes,please) City State Zip Code

SocialSecurity/TaxIDNumber DateofBirth(mm/dd/yyyy) Home Telephone Number BusinessTelephoneNumber Cellular Telephone Number

USA Other Other USA OtherCountry(ies)ofCitizenship CountryofLegalResidence

Other(TobecompletedbythePlanAdministratoronly.)ChoosethisoptionifthiswithdrawalisaMistake of Fact:AnEmployercontributionmadebecauseofanerrorincalculationorotherfactual(notlegal)mistakemaybereturnedtotheEmployerwithinoneyearafteritismade.

B. From a QRP Profit Sharing Plan Only

In-Service Withdrawal: Two-Year RuleSelecttowithdrawvestedEmployercontributionsthathavebeeninthePlanforatleasttwoyears(24months). SeeSection5.01(A)(4)oftheBasicPlanDocument.

In-Service Withdrawal: Five-Year RuleSelecttowithdrawentirevestedaccountbalanceifyouhaveparticipatedinthePlanforatleastfiveyears (60months).SeeSection5.01(A)(4)oftheBasicPlanDocument.

Note:In-ServiceWithdrawalsaresubjectto20%mandatorywithholdingunlessrolledovertoanIRAorQualifiedRetirementPlan.

4. Frequency of Payment (Choose one.)

Youmayrequestaone-time,periodicorlump-sumdistributionfromyourSchwabQRP/Keogh.Ifyouwantacashdistributionfrompositionsotherthanyoursweepmoneymarketfund,pleasespecifyinSection5whichsecuritiesandhowmanysharesyouwouldliketosell,orcontactyourInvestmentAdvisor to place a trade.

A. Lump-Sum Payment (Distribute entire balance.) Youraccountwillbeclosedupondistributionofyourentirebalance.

B. Periodic Payment(Thisoptionisavailableonlyfordistributionsofcashwhenthevestedaccountbalanceismorethan$1,000[$5,000forKeoghaccounts].)

Complete the following information:

Iwouldliketoscheduleaperiodicpaymentintheamountof$______________________ to begin on ______________________ and continue until I instruct otherwise. (mm/dd/yyyy)

Frequency: Monthly Quarterly Semiannually Annually

C. One-Time

3. Distribution Reason (Continued)

WB

of 6


Account Number


5. Payment Instructions(Selectallthatapply.) Distributeentiresweepmoneymarketfundbalance.

Distribute$___________________frommysweepmoneymarketfundbalance.

This amount is a: Before-tax(gross)distribution After-tax(net)distribution Sell and distribute all shares.

Sellspecificsharesofsecuritieslistedbelowanddistribute.(Listsecuritiesyouwantliquidatedbelow.)

TransferallsharesofsecuritiestomySchwabIRAorSchwabOne® account.

TransferspecificsharesofsecuritieslistedbelowtomySchwabIRAorSchwabOneaccount.

Ifapplicable,listallsecuritiestobe:(a)sold,(b)distributedandtransferredtoyournon-retirementSchwabaccount,*or(c)distributedincertificateform.†

Pleaseallowapproximatelyfourweekstoprocessthesedistributions.(Additionalsecuritiesshouldbelistedonaseparatesheetofpaper.)

Name of Security Number of Vested Shares or Dollar Amount

Note: Thevalueofthedistribution(includingsecurities)willbedeterminedusingthemostrecentmarketpricereceivedbySchwabwhenthisformisprocessed.

*Somesecuritiescannotbedelivered.ContactyourInvestmentAdvisorforadditionalinformation.†Schwabchargesaper-certificatefeeforphysicalstockcertificates.PleaserefertotheCharles Schwab Institutional® Pricing Guide for more information.

6. Method of Payment (Choose one from options A–E below and complete the appropriate information.)

YourchoiceinthissectionmayaffectthetaxationofyourSchwabQRP/Keoghpayout.ReadtheinformationintheQualified Retirement Plan (QRP) and KeoghDistributionNoticeattachedtothisform.Consultyourtaxadvisorbeforemakingadecision.

A. Distribution

DirectlydepositmydistributiontomySchwabnon-retirementaccountnumber:________________________________.

Mailmydistribution.Selectonlyone:

Totheaddresslistedonmyaccount.

To the address indicated in Section 3, as applicable.

To the address indicated below:

Street Address City State Zip Code

B. Wire Funds‡ Please provide the following information:

( )BankName ABARoutingNumber(nine-digitnumber) BankTelephoneNumber

BankAccountNumber BankAccountRegistration

‡Feesmayapply.CallyourInvestmentAdvisorfordetails.

WB


of 6

6. Method of Payment (Continued)C. Direct Rollover

IfyouchooseaDirectRolloveroptionbelow,thetaxwithholdinginSection7doesnotapply.Selectonlyoneoptionbelow,providetheapplicableinformation, and proceed to Section 8.

Participant and Spouse Beneficiary only

Direct Rollover of an eligible distribution to my existing Schwab Traditional IRA or Qualified Plan account number: __________________________.

Direct Rollover of an eligible distribution to a new Schwab Traditional IRA (Complete and attach the Schwab IRA Account Application.)

Direct Rollover of an eligible distribution to my non-Schwab Traditional IRA or Qualified Plan account (Please allow 4–6 weeks for processing.)

IRA Qualified Retirement PlanTypeofAccount

Name on Account Account Number

Institution Name Phone Number of Institution

Institution Mailing Address City State Zip Code

ABARoutingNumber Name of Plan

Non-Spouse Beneficiary only

Direct Rollover of an eligible distribution to a new Schwab Inherited IRA (Complete and attach the Schwab IRA Account Application.)

D. Roth Conversion

DirectconversionofaneligibledistributiontomySchwabRothIRA.Selectone:

ConverttomyexistingSchwabRothIRAaccountnumber:________________________________

Convert to a new Schwab Roth IRA (Complete and attach the Schwab IRA Account Application.)

E. Annuity

IfyourPlanAdministratorcheckedthecircleinSection2indicatingthatthePlanissubjecttotheQualifiedJointandSurvivorAnnuity(orSingleLifeAnnuity)rules,youmustcompletethissection.Otherwise,disregardthissectionandproceedtoSection7.

Waiver ElectionAsaParticipantinmyEmployer’sSchwabQualifiedRetirementPlanorKeogh,IacknowledgethatIhavereadtheinformationabouttheAnnuityFormofBenefitintheQRP/KeoghDistributionDisclosureBooklet.IunderstandthatbenefitswillbepaidtomeintheformofaQualifiedJointandSurvivorAnnuity(orSingleLifeAnnuityifIamunmarried)unlessIelecttowaivethatformofpayment.Ifurtherunderstandthat,ifIammarried,myspousemust also consent to the waiver.

IherebyelecttowaivetheQualifiedJointandSurvivorAnnuity.IfyouindicatedthatyouaremarriedinSection1,yourspousemustconsentinwriting(seeSection9C)toyourelectioninthepresenceofanotarypublic.

Note:YouwillbeconsideredunmarriedforpurposesofcompletingtheSchwabQRP/KeoghDistributionRequestForm(andgenerallywillnotneedspousalconsent)ifyouhaveobtainedacourtdecreeofmaritalseparationorabandonment,orifyourspousecannotbelocatedwithreasonableeffort.

7. Tax Withholding ElectionComplete this section only if:

• Your distribution is not an eligible rollover distribution, or

• You are converting your distribution to a Schwab Roth IRA (WithholdingincometaxesmaymakeyouineligiblefortheconversionbecauseamountswithheldareusedwhendeterminingyourincomeforRothconversioneligibility.)

Ifyourdistributioniseligibletoberolledover,20%federalincometaxandyourstate’sminimumincometaxrate,ifapplicable,willbeautomaticallywithheld.Thesetaxeswillnotapplyifyourdistributionisdirectlyrolledover.Formoreinformationabouteligiblerolloverdistributions,seePartThreeofthe enclosed Schwab Qualified Retirement Plan (QRP) and Keogh Distribution Notice.

Distributionsaregenerallysubjecttofederal(andpossiblystate)incometax.Evenifyouelectinwritingnottohavefederaland/orstateincometaxwithheld,youareliableforpaymentoffederalincometaxandstatetaxes,ifapplicable,onthetaxableportionofyourdistribution.Youmayalsobesubjecttotaxpenaltiesundertheestimatedtaxpaymentrulesifyourwithholdingandpaymentofestimatedtax,ifany,arenotadequate.

WhileSchwabmakeseveryefforttoobtaininformationaboutstatetaxlawsfromsourcesbelievedtobereliable,Schwabcannotguaranteetheaccuracyortimelinessofstatetaxwithholdinginformationbecausestatetaxlawsaresubjecttoconstantchangeandinterpretation.Werecommendthatyoucontactyourtaxadvisorregardingyourtaxwithholdingelections,andtoansweranyquestionsthatyoumayhaveregardingyourstate’swithholding laws.

WB


A. Federal Income Tax Withholding Youmayelectnottohavewithholdingapply,oryoumayelecttoincreasetherateofwithholding.Ifyoudonotmakeanelection,Schwabisrequired

towithhold10%forpaymentoffederalincometaxfromyourgrossdistribution.

Choose one:

I do notwantfederalincometaxwithheld.

I wantfederalincometaxwithheldattherateof_______%(mustbeatleast10%andawholenumber).

I wantfederalincometaxwithheldfromeachpaymentbasedonthewithholdingcertificate(IRSFormW-4P)thatIhaveattached.IfIhavenotattachedIRSFormW-4P,IunderstandfederalincometaxwithholdingwillbecalculatedasifIwereamarriedindividualwiththreewithholdingallowances.

B. State Income Tax Withholding Stateincometaxwithholdingmayberequiredfromyourdistribution.Insomecases,youmayelectnottohavewithholdingapply,oryoumayelectto

increasetherateofwithholding.Inothercases,stateincometaxwithholdingisnotavailable.RefertotheenclosedStateIncomeTaxWithholdingInformationsheetforspecificinformationconcerningyourstate.Ifyoudonotmakeanelection,Schwabwillapplywithholding(ifrequired)attheminimumratebasedonyourstateofresidencyasdeterminedbyyourlegaladdressofrecordonyouraccount.

Choose one:

I do notwantstateincometaxwithheld.

I wantstateincometaxwithheldattherateof_______%(mustbeatleastyourstate’sminimumtaxrate).

Ifyoumovebetweenstateswithdifferingwithholdinglaws,Schwabwillapplywithholding(ifrequired)attherateyouhaveprovidedaboveorattheminimumratebasedonthelawsforyournewstateofresidency,whicheverisgreater.YoumaychangeyourtaxwithholdingelectionforfuturedistributionsatanytimebysubmittingyourrequestinwritingtoSchwab.

8. Plan Administrator’s Instructions Regarding Non-Vested Portion of AccountThissectionmustbecompletedbythePlanAdministratorwhentheParticipant’svestedaccountbalanceislessthan100%andtheParticipant’semploymenthasterminated,toprovideinstructionsforhandlingthenon-vestedportionoftheParticipant’saccount.

Thecashandsecuritiesattributedtothenon-vestedportionoftheParticipant’saccountwillbetransferredtoyourPlan’s“HoldingAccount”untilthefundsarereallocatedtootherParticipants’accountsasprovidedintheBasicPlanDocument.IfyourPlanhasnotyetsetupaHoldingAccount,contactyourInvestmentAdvisortorequestanaccountapplication.BesuretosubmitthecompletedapplicationwiththisDistributionRequestForm.

Transfer to Holding Account

A. Plan Holding Account Number: ________________________________

B. Transfer the following non-vested assets.Selectallthatapply: Transfer$_________________________fromthemoneymarketfundbalance. Transfer the specific shares of securities listed below (list additional securities on a separate sheet of paper).

Name of Security Number of Vested Shares or Dollar Amount

9. SignaturesA. Signature of Plan Administrator

AsthePlanAdministrator,IauthorizeSchwabtodistributePlanbenefitsfromtheSchwabQRPandKeoghaccountasindicatedonthisDistributionRequestForm.IcertifythattheinformationIhaveprovidedinthisDistributionRequestFormistrueandcorrecttothebestofmyknowledge;thatIhave provided the Participant (orotherRecipient)withacopyoftheSchwabQRP/KeoghDistributionDisclosureBooklet;andthatthisdistributioncomplies with the provisions of the Schwab QRP (or, if applicable, the Schwab Keogh) and the Internal Revenue Code. If the “Distribution Due to QualifiedDomesticRelationsOrder(QDRO)”circleischeckedinSection3A,IfurthercertifythatIhavedeterminedthatthedomesticrelationsorderpursuant to which this distribution is being made constitutes a qualified domestic relations order within the meaning of Section 414(p) of the Internal RevenueCode.Ifthe“DistributionDuetoDeathofParticipant”circleischeckedinSection3A,Ifurthercertifythattherecipientisentitledtothedistributionunderavalidbeneficiarydesignationor,ifnone,undertheapplicableprovisionsoftheSchwabQRP(or,ifapplicable,theSchwabKeogh).IauthorizeSchwabtorelyontheforegoingcertificationwithoutfurtherinvestigationorinquiry.

Signature(s) Required

___________________________________________________________________________________________________ Date _______________________Signature: Plan Administrator PrintName (mm/dd/yyyy)

___________________________________________________________________________________________________ Date _______________________Signature: Additional Plan Administrator PrintName (mm/dd/yyyy)

of 6

7. Tax Withholding Election (Continued)

WB


B. Signature of Plan Participant or Recipient

Iherebyconsentto,andrequestpaymentfrom,theQualifiedRetirementPlandesignatedaboveinthemannerindicated.Inaddition,ifIameligibletowaivethenoticerequirementsunderSections402(f),417(a)(3)and411(a)(11)oftheInternalRevenueCode,Iherebywaivethe30-daynoticeperiod.

Icertifythatallinformationprovidedbymeistrueandaccurate,andIagreetosubmitadditionalinformationifrequestedbythePlanAdministrator,SchwaboranyPlanfiduciary.IhavereceivedtheSchwabQualifiedRetirementPlan(QRP)andKeoghDistributionNoticeandhavereadandunder-stoodtheportionsofitreferencedinthesectionsIhavecompletedinthisDistributionRequestForm.NotaxadvicehasbeengiventomebyeitherthePlanAdministratororSchwab.Alldecisionsregardingthisdistributionaremyown.Iexpresslyassumetheresponsibilityforanyadverseconsequences which mayresultfromthisdistribution,andIagreethatthePlanAdministrator,SchwabandanyPlanfiduciaryshallinnowayberespon-sible for those consequences.

Icertifythatthenumbershownonthisapplicationismycorrecttaxpayeridentificationnumber.

Signature Required

___________________________________________________________________________________________________ Date _______________________Signature: Plan Participant or Recipient PrintName (mm/dd/yyyy)

C. Signature of Spouse (requiredonlyifyouhaveelectedtowaivetheQualifiedJointandSurvivorAnnuityinSection6E)

IamthespouseoftheParticipant.Iherebyconsenttomyspouse’selectionnottohavebenefitspaidintheformofaQualifiedJointandSurvivorAnnuity.Iunderstandthatbyconsentingtomyspouse’swaiver,ImaybeforfeitingbenefitsIwouldbeentitledtoreceivewhenmyspousedies.Ialsounderstandthatmyconsentcannotberevokedunlessmyspouserevokestheabovewaiver.

Signature Required

___________________________________________________________________________________________________ Date _______________________Signature: Spouse PrintName (mm/dd/yyyy)

D. Notarization of Spouse Signature

Thesignatureofthespousemustbewitnessedinthepresenceofanotarypublic.

State of ___________________________________ ,Countyof __________________________________________

On ________________________ before me, __________________________________________________________ , (mm/dd/yyyy) (NameandTitleoftheNotarizingOfficer)

personallyappeared _____________________________________________________________________________ , (NameofPerson[s]SigningInstrument)

whoprovedtomeonthebasisofsatisfactoryevidencetobetheperson(s)whosename(s)is/aresubscribedtothewithininstrumentandacknowledgedtomethathe/she/theyexecutedthesameinhis/her/theirauthorizedcapacity(ies),andthatbyhis/her/theirsignature(s)ontheinstrumenttheperson(s),ortheentityuponbehalfofwhichtheperson(s)acted,executedtheinstrument.*

IcertifyunderPENALTYOFPERJURYunderthelawsoftheStateof______________________thattheforegoing paragraph is true and correct.

WITNESSmyhandandofficialseal.

NotaryPublic _________________________________________ ExpirationDate __________________________ (SignatureofNotarizingOfficer) (mm/dd/yyyy)

*NotariesoutsideofCaliforniamayattachtheappropriatenotarizingdeclarationinlieuoftheabove.

(NOTARY SEAL)

9. Signatures (Continued)

of 6


Account Number

WB

of 5


CLIENT C

OPy

Qualified Retirement Plan (QRP) and Keogh Distribution Notice

INTRODuCTIONAsaparticipantinyouremployer’sSchwabQualified Retirement Plan (QRP) or Keogh (the “Plan”),youhaveaccumulatedavestedaccountbalance.Youmayreceiveyourvestedaccountbalanceonlyifyouincuratriggeringevent.Youmayincuratriggeringeventif:• youattainthenormalretirementage

indicated in the Plan• youquitworkingforyouremployer• youbecomedisabled• youremployerterminatesthePlan• yourPlanpermitsin-servicedistributionsYoumayhavetherighttodeferreceivingadistributionofyourvestedaccountbalancefromyouremployer’sPlanifyoumeetbothofthefollowing:• yourvestedaccountbalanceunderthePlan

isgreaterthan$1,000($5,000fortheKeogh), and

• youhaven’treachednormalretirementage.However,youmustbeginreceivingpaymentsfromthePlanwhenyoureachage70½.(Ifyouown less than 5% of the business sponsoring the Plan and work for the business past age 70½,youneednotbeginreceivingpaymentsuntilyouretire.)Note: Generally,paymentsfromyouremployer’sPlanmustbedelayedforaminimumof30daysafteryoureceivethisnotice,toallowyoutimetoconsideryourdistributionoptions.Althoughyouareentitledtoconsideryourdistributionoptionsforaperiodof30days,youmaywaivethis30-daynoticerequirementbysigningandsubmitting the QRP & Keogh Distribution RequestForm.However,ifyouremployer’sPlanisaQRPMoneyPurchasePensionplanoraKeoghplanandyouwaivethe30-daynoticerequirement,youremployermustneverthelesswaitsevendaysafteryoureceivethisnoticebefore commencing distributions.Thelawdictatestheoptionalformsthatyourpaymentsmaytake.Thelawalsospecifieshowthedifferenttypesofpaymentswillbetaxed.Thisnoticesummarizesyourdistributionoptionsandillustratesthefinancialeffectandthetaxconsequences of each distribution option. Pleasereaditcarefully.Itisalwaysagoodideatoconsultwithataxadvisorbeforecommencingdistributions.PartOneofthisnoticedescribestheplanpaymentoptionsavailabletoyou.PartTwodescribesyourbeneficiary’spaymentoptions.PartThreecontainsaspecialtaxnotice,requiredbytheIRS,thatexplainsthetaxtreatmentofyourplanpaymentanddescribesthedirectrolloveroptionfor eligible rollover distributions.Note:Thepaymentamountsindicatedinthisnoticeareonlyexamples.Thecalculationsforthequalifiedjointandsurvivorannuityarebasedonstandardmortalitytablesusinga5%interestrateandapaymentageof65.Actualpaymentamountswillvarydependingupontheentityfromwhichyoupurchaseyourannuity.Youmayobtainfinancialprojectionsbaseduponyouraccountbalancebysubmittingarequest,inwriting,toyourPlanAdministrator.

PART ONE—PAyMENT OPTIONS FOR PLAN PARTICIPANTSThis notice provides information about the paymentoptionsthatmayormaynotbeavailableunderthePlan.IfyourPlanAdministra-tor has not indicated in Section 2 of the QRP & Keogh Distribution Request Form that the Plan issubjecttoQualifiedJointandSurvivorAnnuityrules,orifyourvestedaccountbalanceis$1,000orless($5,000orlessforKeogh),thenOptionIisnotavailabletoyou.YourEmployerintendsforyourplanaccounttoprovideincometoyouduringretirement.Ifyoutakeadistributionpriortoretiringorspendyourretirementsavingstooquickly,youmaynothavesufficientincometoliveoninretirement.Ifyouterminateemploymentandleaveyourmoneyinthe Plan, a share of the Plan’s administrative expensesmaybechargedtoyouraccounteachyear.RefertoyourPlanAdministratorforanexplanationofanyadministrativeexpensesthatmaybechargedtotheaccountsofterminatedparticipants.Ifyouchoosetorolloveryourvestedaccountbalance to an IRA or other eligible retirement plan, the distributing plan’s investment options maynotbeavailableunderthereceivingretirementarrangementandthefeesmaydifferfromthosechargedtoyouifyourbalanceremained in the Plan. Complete information concerning available investment options and feescurrentlychargedbythePlan,ifapplicable,isavailablefromyourPlanAdministrator.

Option I—Qualified Joint and Survivor AnnuityThelawrequiresthatyourvestedaccountbalancebepaidtoyouintheformofaqualifiedjointandsurvivorannuityifyouaremarried,orasinglelifeannuityifyouarenotmarried.Ifyouwishtoreceiveyourvestedaccountbalanceusing a different distribution option (including a qualifiedoptionalsurvivorannuity),youmustwaivethequalifiedjointandsurvivorannuity(thesinglelifeannuityifyouarenotmarried)andyourspousemustconsenttotheannuitywaiverifyouaremarried.Unlessproperlywaived,youwillreceiveyourvested account balance in the form of a qualifiedjointandsurvivorannuity(orsinglelifeannuityifyouarenotmarried).

A. Qualified Joint and Survivor Annuity Defined Ifyouaremarried,aqualifiedjointand

survivorannuityisaseriesofperiodicpaymentstoyouduringyourlifetimeandtoyourspouseuponyourdeath.Theperiodicpaymentamountyourspousereceiveswillbeasetpercentageoftheperiodicpaymentamountyoureceivedduringyourlifetime.Todeterminethepercentageyourspousewouldreceive(i.e.,survivorannuity),contactthePlan Administrator.

Ifyouarenotmarried,aqualifiedjointandsurvivorannuityisaseriesofannuitypaymentsoveryourlife.

B. Waiving the Qualified Joint and Survivor Annuity

Ifyouwishtoreceiveyourvestedaccountbalanceinalumpsumorperiodicpayment,

asdescribedinOptionsIIandIII,you(and,ifyouaremarried,yourspouse)mustwaivethequalifiedjointandsurvivorannuityontheQRP & Keogh Distribution Request Form. After waiving the qualified joint and survivor annuitybycompletingandsigningthedistributionform,youmayreceiveyourvested account balance using one of the otherpaymentoptions.

C. Financial Effect and Tax Consequences of a Qualified Joint and Survivor Annuity

As stated above, a qualified joint and survivorannuitywillprovideperiodicpaymentstoyouduringyourlifetimeand,ifyouaremarried,toyourspouseafteryourdeath.Yourspousewillgenerallyreceivesmallerperiodicpaymentsthanyoureceivedwhileyouwerealive.TheannuitywillbeprovidedbypurchasinganannuitycontractfromaninsurancecompanywithyouraccountbalanceunderthePlan.Generally,eachpaymentwillbeincludedinyourincomeintheyearinwhichyoureceiveit.Forexample,assumeaparticipantretireswitha$10,000vestedaccountbalance.Aqualifiedjointandsurvivorannuitywouldprovidehimorherwiththefollowingpayments.

Lifetime MonthlyParticipant Benefit

% of Survivor Annuity*

MonthlySurvivor Benefit

$63.40 100% $63.40

$66.30 75% $49.72

$67.30 66.67% $44.86

$69.40 50% $34.70

*Theseestimatesarederivedfromstandardmortalitytablesusingaparticipantwitha65-year-oldspousebeneficiarybeginningpaymentsatage65.Todeterminethesurvivorannuitypercentage,contactyourPlanAdministrator.Thisexampleusesestimates and should not be viewed as an assurance that an insurer is able to provide the specific amount disclosed.

D. Qualified Optional Survivor Annuity Defined ForPlanyearsbeginningafterDecember31,

2007,ifyouproperlywaivethequalifiedjointandsurvivorannuityandyourvestedaccountbalanceismorethan$1,000($5,000forKeogh),youmayuseyourvestedaccountbalance to purchase a qualified optional survivorannuity.Likeaqualifiedjointandsurvivorannuity,aqualifiedoptionalsurvivorannuityisaseriesofperiodicpaymentstoyouduringyourlifetimeandtoyourspouseuponyourdeath.

Theoptionalsurvivorannuitymeansanannuity(1)foryourlifewithasurvivorannuityforthelifeofyourspouse,whichisequaltothe applicable percentage of the amount of theannuitywhichispayableduringthejointlivesofyouandyourspouse,and(2)whichistheactuarialequivalentofasingleannuityforyourlife.Ifthesurvivorannuitypercent-age (1) is less than 75%, the applicable

WB

of 5


CLIENT C

OPy

percentage is 75%, and (2) is greater than or equal to 75%, the applicable percentage is 50%.Todeterminetheamountyourspousewouldreceive,contactyourPlanAdministrator.

Option II—Lump-Sum PaymentIfyouproperlywaivethequalifiedjointandsurvivorannuityoryourvestedaccountbalanceismorethan$1,000($5,000forKeogh),youmayrequestalump-sumpayment.

A. Lump-Sum Payment Defined Alump-sumpaymentisthepaymentofyour

entire vested account balance.

B. Financial Effect and Tax Consequences of a Lump-Sum Payment

Generally,alump-sumpaymentisincludedinyourincomeandtaxedintheyearofthedistribution.Mostlump-sumpaymentsareeligible rollover distributions and would, therefore, be subject to the 20% withholding rulesunlessdirectlyrolledovertoanotherplan or Traditional IRA. See Part Three, “SpecialTaxNoticeRegardingPlanPay-ments,” for more information.

Option III—Periodic PaymentsIfyouproperlywaivethequalifiedjointandsurvivorannuityorifyourvestedaccountbalanceismorethan$1,000($5,000forKeogh),youmayelecttoreceiveyourvestedaccountbalanceinperiodicpayments.Periodicpaymentsforaperiodoflessthan10yearsaregenerallyeligiblerolloverdistributionsandwould, therefore, be subject to the 20 percent withholdingrulesunlessdirectlyrolledovertoanother plan or Traditional IRA. See Part Three, “SpecialTaxNoticeRegardingPlanPayments,”for more information.

A. Periodic Payments Defined Installmentpaymentsarepayments

distributedtoyouinanyamountyouchooseatintervalsthatyoudeterminewithinlimitssetbythetrusteeorcustodian.Forexample,thepaymentscouldbepaidtoyouannually,semiannually,quarterlyormonthly.Thepaymentscheduleyouchoosecannotbelongerthanyoursinglelifeexpectancyor,ifyouhaveabeneficiarynamed,thejointlifeexpectancyofyouandyourbeneficiary.

B. Financial Effect and Tax Consequences of Installment Payments

Generally,eachinstallmentpaymentwillbeincludedinyourincomeintheyearinwhichyoureceiveit.Forexample,aparticipantwhoelectstoreceive$500permonthwillinclude$6,000($500x12months)inincomeeachtaxyear.

PART TWO—PAyMENT OPTIONS FOR BENEFICIARIES OF DECEASED PLAN PARTICIPANTSIfyouarethedesignatedbeneficiaryofadeceased participant’s vested account balance, youareeligibletoreceiveadistribution.Theformofthepaymentdependsonseveralfactors,includingthetypeofplanandtheamount in the participant’s account.

A. Participant’s Account Balance If the participant’s vested account balance

was$5,000orlessatthetimeofdistribu-tion,yourPlanAdministratorisrequiredtopayyourdistributiontoyouinasinglecash

payment.Iftheparticipant’svestedaccountbalanceexceeded$5,000,youmustconsenttotheformofpayment.

B. Type of Plan Note:YourPlanAdministratorcantellyou

whichtypeofplanthisis.

1. QRP Profit Sharing Plans Only YoumayselecteitherOptionIIorIIIas

describedinPartOne.However,ifyouselecttheperiodicpaymentmethoddescribedinOptionIII,thepaymentscheduleyouchoosecannotbelongerthanyoursinglelifeexpectancy.

2. All Other Plans If the plan participant died before

required distributions commenced and youareaspousebeneficiary,distribu-tionsfromthePlanmustbepaidtoyou(if applicable) in the form of a qualified preretirementsurvivorannuity,unlesstheannuityrequirementwasproperlywaived.AparticipantwaivestheannuityrequirementbycompletingaQRP&Keogh Distribution Request Form and obtainingyourwrittenconsenttothewaiver.Iftheparticipantdidnotexecutethe required waivers, then his or her accountbalancewillbepaidtoyou(thedeceased participant’s spouse) in the formofapreretirementsurvivorannuityunlessthePlanspecificallypermitsyoutoelecttoreceivepaymentsinaformother than a qualified preretirement survivorannuity.Ifyouareanonspousebeneficiaryofadeceasedparticipantwhowasmarried,youwillnotreceiveanypaymentfromthePlanunlesstheparticipantproperlywaivedtherequire-ment that his or her spouse be the beneficiary.

Ifthequalifiedpreretirementsurvivorannuitywasproperlywaivedbytheparticipantand/orhisorherspouse(ifapplicable),thenyoumayreceivetheentirevestedaccountbalanceinalump-sumpaymentasexplainedin Part One, Option II. The rollover option describedinPartThree,B,isavailableonlyifyouarethespouseofthedeceasedparticipant. The other distribution options availabletoyouasabeneficiaryareexplainedinPartOne,OptionIII.However,thepaymentscheduleyouchoosecannotbelongerthanyoursinglelifeexpectancy.

PART THREE—SPECIAL TAx NOTICE REgARDINg PLAN PAyMENTS Thisnoticeexplainshowyoucancontinuetodeferfederalincometaxonyourretirementsavings,andcontainsimportantinformationyouwillneedbeforeyoudecidehowtoreceiveyourPlan benefits. ItisprovidedtoyoubecauseallorpartofthepaymentthatyouwillsoonreceivefromthePlanmaybeeligibleforrollovertoanIRAoraneligibleemployerplan.ArolloverisapaymentbyyouorthePlanAdministratorofallorpartofyourbenefittoanotherplanorIRAthatallowsyoutocontinuetopostponetaxationofthatbenefituntilitispaidtoyou.Yourpaymentcannot be rolled over to a SIMPLE IRA or a Coverdell Education Savings Account. An “eligibleemployerplan”includesaplanqualifiedunder section 401(a) of the Internal Revenue

Code, including a 401(k) plan, profit sharing plan, defined benefit plan, stock bonus plan, andmoneypurchasepensionplan;asection403(a)annuityplan;asection403(b)tax-shel-teredannuity;andaneligiblesection457(b)planmaintainedbyagovernmentalemployer(governmental 457 plan).Note:YouremployerhasreceivedanIRSopinionletter that this Plan is qualified.Aneligibleemployerplanisnotlegallyrequiredtoacceptarollover.Beforeyoudecidetorolloveryourpaymenttoanotheremployerplan,youshould find out whether the plan accepts rolloversand,ifso,thetypesofdistributionsitaccepts as a rollover. You should also find out aboutanydocumentsthatarerequiredtobecompleted before the receiving plan will accept a rollover. Even if a plan accepts rollovers, it mightnotacceptrolloversofcertaintypesofdistributions,suchasafter-taxamounts.Ifthisisthecaseandyourdistributionincludesafter-taxamounts,youmaywishinsteadtorollyourdistributionovertoaTraditionalIRAorsplityourrolloveramountbetweentheemployerplaninwhichyouwillparticipateandaTraditionalIRA.Ifanemployerplanacceptsyourrollover,itmayrestrictsubsequentdistributionsoftherolloveramountorrequireyourspouse’sconsentforanysubsequentdistribution.Asubsequent distribution from the plan that acceptsyourrollovermayalsobesubjecttodifferenttaxtreatmentthandistributionsfromthis Plan. Check with the administrator of the planthatistoreceiveyourrolloverpriortomaking it.Ifyouhaveadditionalquestionsafterreadingthisnotice,contactyourPlanAdministrator.

I. Summary of Payment Options Therearetwowaysyoumaybeableto

receiveaPlanpaymentthatiseligibleforrollover:(1)certainpaymentscanbemadedirectlytoanIRAthatyouestablishortoaneligibleemployerplanthatwillacceptitandholditforyourbenefit(“directrollover”);or(2)thepaymentcanbepaidtoyou.

Ifyouchooseadirectrollover:• Yourpaymentwillnotbetaxedinthe

currentyearandnoincometaxwillbewithheld.

• YouchoosewhetheryourpaymentwillbemadedirectlytoyourIRAortoaneligibleemployerplanthatacceptsyourrollover.YourpaymentcannotberolledovertoaSIMPLE IRA or a Coverdell Education Savings Account.

• ThetaxableportionofyourpaymentwillbetaxedlaterwhenyoutakeitoutoftheTraditionalIRAortheeligibleemployerplan.Dependingonthetypeofplan,thelaterdistributionmaybesubjecttodifferenttaxtreatmentthanitwouldbeifyoureceivedataxabledistributionfromthis Plan.

IfyouchoosetohaveaPlanpaymentthatiseligibleforrolloverpaidtoyou:

• Youwillreceiveonly80%ofthetaxableamountofthepaymentbecausethePlanAdministrator is required to withhold 20% of that amount and send it to the IRS as federalincometaxwithholdingtobecreditedagainstyourtaxes.Stateincometaxwithholdingmayalsoapply.

WB


CLIENT C

OPy

• Thetaxableamountofyourpaymentwillbetaxedinthecurrentyearunlessyouroll it over. Under limited circumstances, youmaybeabletousespecialtaxrulesthatcouldreducethetaxyouowe.However,ifyoureceivethepaymentbeforeage59½,youmayhavetopayanadditional10%tax.

• YoucanrolloverthepaymentbypayingittoyourIRAortoaneligibleemployerplanthatacceptsyourrolloverwithin60daysafteryoureceivethepayment.TheamountrolledoverwillnotbetaxeduntilyoutakeitoutoftheTraditionalIRAortheeligibleemployerplan.

• Ifyouwanttorollover100%ofthepaymenttoanIRAoraneligibleemployerplan,youmustfindothermoneytoreplace the 20% that was withheld for federaltaxes.Ifyourolloveronlythe80%thatyoureceive,youwillbetaxedonthe20% that was withheld and is not rolled over.

A. Payments That Can and Cannot Be Rolled Over

PaymentsfromthePlanmaybe“eligiblerollover distributions.” This means that theycanberolledovertoanIRAortoaneligibleemployerplanthatacceptsrollovers.Paymentsfromaplancannotbe rolled over to a SIMPLE IRA or a Coverdell Education Savings Account. Your Plan Administrator should be able to tellyouwhatportionofyourpaymentisaneligiblerolloverdistributionandifyourpaymentincludesamountsthatcannotbe rolled over.

Thefollowingtypesofpaymentscannotbe rolled over:

1. Payments Spread Over Long Periods (Substantially Equal Payments)

Youcannotrolloverapaymentifitispart of a series of equal (or almost equal)paymentsthataremadeatleastonceayearandwilllastfor:• yourlifetime(oraperiodmeasured

byyourlifeexpectancy),• yourlifetimeandyourbeneficiary’s

lifetime(oraperiodmeasuredbyyourjointlifeexpectancies),or

• aperiodof10yearsormore.

2. Required Minimum Payments Beginningwhenyoureachage70½or

retire, whichever is later, a certain portionofyourpaymentcannotberolled over because it is a “required minimumpayment”thatmustbepaidtoyou.Specialrulesapplyifyouownmorethan5%ofyourbusinessthatsponsorsyourPlan.

3. Corrective Distributions A distribution that is made because

legal limits on certain contributions wereexceededcannotberolledover.

B. Direct Rollover Adirectrolloverisadirectpaymentofthe

amountofyourPlanbenefitstoaTraditionalIRAoraneligibleemployerplan that will accept it. You can choose a directrolloverofalloranyportionofyourpaymentthatisan“eligiblerolloverdistribution,” as described in Part A. You

arenottaxedonanytaxableportionofyourpaymentforwhichyouchooseadirectrolloveruntilyoulatertakeitoutoftheTraditionalIRAoreligibleemployerplan.Inaddition,noincometaxwithhold-ingisrequiredforanyportionofyourPlanbenefitsforwhichyouchooseadirectrollover.

1. Direct Rollover to a Traditional IRA You can open a Traditional IRA to

receivethedirectrollover.IfyouchoosetohaveyourpaymentmadedirectlytoaTraditionalIRA,contactanIRAsponsor(usuallyafinancialinstitution) to find out how to have yourpaymentmadeinadirectrolloverto a Traditional IRA at that institution. Ifyouareunsureofhowtoinvestyourmoney,youcantemporarilyestablishaTraditionalIRAtoreceivethepayment.However, in choosing a Traditional IRA,youmaywishtomakesurethattheTraditionalIRAyouchoosewillallowyoutomoveallorapartofyourpaymenttoanotherTraditionalIRAata later date without penalties or other limitations. See IRS Publication 590, Individual Retirement Arrangements, for more information on Traditional IRAs (including limits on how often youcanrolloverbetweenIRAs).

2. Direct Rollover to a Roth IRA For distributions taken after December

31,2007,youcanopenaRothIRAtoreceivearolloverfromyouremployer’splanifyourmodifiedadjustedgrossincome (MAGI) is not more than $100,000andyouarenotmarriedfilingaseparateincometaxreturn.TheamountoftherolloverfromyouremployerplantotheRothIRAwillbetreated as a distribution for income taxpurposesandisincludibleinyourgrossincome.Beginningin2010,the$100,000MAGIlimitandthemarriedfilingseparatelytaxfilingrestrictionwillbeeliminatedforrollovereligibility.Although the rollover amount is generallyincludedinincome,the10%earlydistributionpenaltywillnotapply,regardlessofwhetherornotyouqualifyforanyexceptionstothe10%penalty.IfyouchoosetohaveyourpaymentmadedirectlytoaRothIRA, contact a Roth IRA sponsor (usuallyafinancialinstitution)tofindouthowtohaveyourpaymentmadeas a rollover to a Roth IRA.

3. Direct Rollover to a Plan Ifyouareemployedbyanewemployer

thathasaneligibleemployerplanandyouwantadirectrollovertothatplan,ask the Plan Administrator of that plan whetheritwillacceptyourrollover.Aneligibleemployerplanisnotlegallyrequired to accept a rollover. Even if yournewemployer’splandoesnotacceptarollover,youcanchooseadirect rollover to a Traditional IRA. If yournewemployer’splanacceptsyourrollover,theplanmayproviderestrictions on the circumstances underwhichyoumaylaterreceiveadistribution of the rollover amount or

requirespousalconsenttoanysubsequent distribution. Check with the Plan Administrator of that plan beforemakingyourdecision.

4. Direct Rollover of a Series of Payments Ifyoureceiveapaymentthatcanbe

rolled over to a Traditional IRA or an eligibleemployerplanthatwillacceptit and it is paid in a series of paymentsforlessthan10years,yourchoice whether or not to make a direct rolloverforapaymentwillapplytoalllaterpaymentsintheseriesuntilyouchangeyourelection.Youarefreetochangeyourelectionforanylaterpaymentintheseries.

5. Change in Tax Treatment Resulting from a Direct Rollover

ThetaxtreatmentofanypaymentfromtheeligibleemployerplanorTraditionalIRAreceivingyourdirectrollovermightbedifferentthanifyoureceivedyourbenefitinataxabledistributiondirectlyfromthePlan.Forexample,ifyouwerebornbeforeJanuary1,1936,youmightbeentitledto10-yearaveragingorcapitalgaintreatment,asexplainedbelow.However,ifyouhaveyourbenefitrolledovertoasection403(b)tax-shelteredannuity,agovernmental457planoraTraditionalIRAinadirectrollover,yourbenefit will no longer be eligible for that special treatment. See “Addi-tional10%TaxIfYouAreUnderAge59½”and“SpecialTaxTreatmentIfYouWereBornBeforeJanuary1,1936”formoreinformation.

C. Payment Paid to You Ifyourpaymentcanberolledoverand

thepaymentismadetoyouincashorwithacheckmadeouttoyou,itissubjectto20%federalincometaxwithholdingonthetaxableportion(statetaxwithholdingmayalsoapply).Thepaymentistaxedintheyearyoureceiveitunless,within60days,yourollitovertoaTraditionalIRAoraneligibleemployerplanthatacceptsrollovers.Ifyoudonotrollitover,specialtaxrulesmayapply.

1. Income Tax Withholdinga. Mandatory Withholding Ifanyportionofyourpaymentcan

berolledoverandyoudonotelectto make a direct rollover, the Plan isrequiredbylawtowithhold20%ofthetaxableamountforfederalincometaxes.ThisamountissenttotheIRSasfederalincometaxwithholding(statetaxesmayalsoapply).Forexample,ifyoucanrolloverataxablepaymentof$10,000but elect not to make a direct rollover,only$8,000willbepaidtoyoubecausethePlanmustwithhold$2,000asincometax(stateincometaxesmayalsoapply).However,whenyouprepareyourincometaxreturnfortheyear,unlessyoumakearolloverwithin60days(see“Sixty-DayRolloverOption”),youmustreportthefull$10,000asataxablepayment

Page 3 of 5

WB


CLIENT C

OPy

from the Plan. You must report the $2,000astaxwithheld,anditwillbecreditedagainstanyincometaxyouowefortheyear.Therewillbenoincometaxwithholdingifyourpaymentsfortheyeararelessthan$200.

b. Voluntary Withholding Ifanyportionofyourpaymentis

taxablebutcannotberolledover,themandatorywithholdingrulesdescribeddonotapply.Inthiscase,youmayelectnottohavewithholdingapplytothatportion.Ifyoudonothing,anamountwillbetakenoutofthisportionofyourpaymentforfederalincometaxwithholding. To elect out of withholding, check the appropriate boxinSection7oftheQRP&Keogh Distribution Request Form.

c. Sixty-Day Rollover Option Ifyoureceiveapaymentthatcan

berolledover,youstillhave60daystodecidetorolloverallorpart of it to a Traditional IRA or to aneligibleemployerplanthatacceptsrollovers.Ifyoudecidetorollitover,youmustcontributetheamountofthepaymentyoureceived to a Traditional IRA or eligibleemployerplanwithin60daysafteryoureceivethepayment.TheportionofyourpaymentthatisrolledoverwillnotbetaxeduntilyoutakeitoutoftheTraditional IRA or the eligible employerplan.

IfyoureceiveapaymentafterDecember 31, 2007, that can be rolledover,youcanstilldecidetoroll over all or part of it to a Roth IRA.Ifyouchoosetorollitover,you must contribute the amount of the payment you received to a Roth IRA within 60 days after you receive the payment.Theportionofyourpaymentthatisrolledoverwillbetaxedatthetimeitisdistributed,but will not be subject to the 10% earlydistributionpenalty.

Youcanrolloverupto100%ofyourpaymentthatcanberolledover,including an amount equal to the 20% ofthetaxableportionthatwaswithheldforfederalincometaxes.Ifyouchoosetorollover100%,youmustfindothermoneywithinthe60-dayperiodtocontributetotheTraditionalIRAortheeligibleemployerplan to replace the 20% that was withheld.Ontheotherhand,ifyourolloveronlythe80%ofthetaxableportionthatyoureceived,youwillbetaxedonthe20%thatwaswithheld.

Example:Thetaxableportionofyourpaymentthatcanberolledoveris$10,000,andyouelecttohaveitpaidtoyou.Youwillreceive$8,000,and$2,000willbesenttotheIRSasfederalincometaxwithholding.Within60daysafterreceivingthe$8,000,youmayrollovertheentire$10,000

to a Traditional IRA or an eligible employerplan.Todothis,rolloverthe$8,000youreceivedfromthePlanandfind$2,000fromothersources(yoursavings,aloan,etc.).Inthiscase,theentire$10,000isnottaxeduntilyoutakeitoutoftheTraditionalIRAoraneligibleemployerplan.Ifyourollovertheentire$10,000youmayget a refund of part or all of the $2,000withheldwhenyoufileyourfederalincometaxreturn.

If,ontheotherhand,yourolloveronly$8,000,the$2,000youdidnotrolloveristaxedintheyearitwaswithheld.Whenyoufileyourfederalincometaxreturn,youmaygetarefundofpartofthe$2,000withheld.(However,anyrefundislikelytobelargerifyourollovertheentire$10,000.)

2. Additional 10% Tax If You Are Under Age 59½

Ifyoureceiveapaymentbeforeyoureachage59½andyoudonotrollitover, then, in addition to the regular incometax,youmayhavetopayanextrataxequalto10%ofthetaxableportionofthepayment.Theadditional10%taxgenerallydoesnotapplyto(1)paymentsthatarepaidafteryouseparatefromservicewithyouremployerduringoraftertheyearyoureachage55,(2)paymentsthatarepaidbecauseyouretireduetodisability,(3)paymentsthatarepaidasequal(oralmostequal)paymentsoveryourlifeorlifeexpectancy(oryourandyourbeneficiary’slivesorlifeexpectancies),(4)dividendspaidwithrespecttostockbyanemployeestockownership plan (ESOP) as described in Internal Revenue Code section 404(k),(5)paymentsthatarepaiddirectlytothegovernmenttosatisfyafederaltaxlevy,(6)paymentsthatarepaidtoanalternatepayeeunderaQualified Domestic Relations Order (QDRO),(7)paymentsthatdonotexceedtheamountofyourdeductiblemedicalexpenses,or(8)paymentsthatarepaidtoyouasaqualifiedmilitaryreservist.SeeIRS Form 5329, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, for more information on the additional10%tax.

Theadditional10%taxwillnotapplyto distributions from a governmental 457plan,excepttotheextentthedistribution is attributable to an amountyourolledovertothatplan(adjusted for investment returns) from anothertypeofeligibleemployerplanorIRA.Anyamountrolledoverfromagovernmental 457 plan to another typeofeligibleemployerplanortoaTraditional IRA will become subject to theadditional10%taxifitisdistributedtoyoubeforeyoureachage59½,unlessoneoftheexcep-tions listed above applies.

3. Special Tax Treatment If You Were Born Before January 1, 1936

IfyoureceiveapaymentfromthePlanthatcanberolledoverandyoudonotroll it over to a Traditional IRA or an eligibleemployerplanthatwillacceptit,thepaymentwillbetaxedintheyearyoureceiveit.However,ifthepaymentqualifiesasa“lump-sumdistribution,”itmaybeeligibleforspecialtaxtreatment(seealso“EmployerStockorSecurities”).Alump-sumdistributionisapayment,withinoneyear,ofyourentirebalanceunder the Plan (and certain other similarplansoftheemployer)thatispayabletoyouafteryouhavereachedage59½orbecauseyouhaveseparatedfromservicewithyouremployer(or,inthecaseofaself-employedindividual,afteryouhavereachedage59½orhavebecomedisabled).Forapaymenttobe treated as a lump-sum distribution, youmusthavebeenaparticipantinthePlanforatleastfiveyearsbeforetheyearinwhichyoureceivedthedistribution.Thespecialtaxtreatmentforlump-sumdistributionsthatmaybeavailabletoyouisdescribedbelow.

a. Ten-Year Averaging Ifyoureceivealump-sum

distribution and were born before January1,1936,youcanmakeaone-timeelectiontofigurethetaxonthepaymentbyusing“10-yearaveraging”(using1986taxrates).Ten-yearaveragingoftenreducesthetaxyouowe.

b. Capital Gain Treatment Ifyoureceivealump-sum

distribution and were born before January1,1936,andwereaparticipantinthePlanbefore1974,youmayelecttohavethepartofyourpaymentthatisattributabletoyourpre-1974participationinthePlantaxedaslong-termcapitalgain at a rate of 20%.

There are other limits on the special taxtreatmentforlump-sumdistribu-tions.Forexample,youcangenerallyelectthisspecialtaxtreatmentonlyonceinyourlifetime,andtheelectionapplies to all lump-sum distributions thatyoureceiveinthatsameyear.YoumaynotelectthisspecialtaxtreatmentifyourolledamountsintothisPlanfroma403(b)tax-shelteredannuitycontract,agovernmental457planoranIRAnotoriginallyattribut-abletoaqualifiedemployerplan.Ifyouhavepreviouslyrolledoveradistribution from this Plan (or certain othersimilarplansoftheemployer),youcannotusethisspecialaveragingtreatmentforlaterpaymentsfromthePlan.IfyourolloveryourpaymenttoaTraditional IRA, governmental 457 planor403(b)tax-shelteredannuity,youwillnotbeabletousethisspecialtaxtreatmentforlaterpaymentsfromthatIRA,planorannuity.Also,ifyou

Page 4 of 5

WB


CLIENT C

OPy

rolloveronlyaportionofyourpaymentto a Traditional IRA, governmental 457 planor403(b)tax-shelteredannuity,thisspecialtaxtreatmentisnotavailablefortherestofthepayment.See IRS Form 4972, Tax on Lump-Sum Distributions, for additional information on lump-sum distributions and how to electthespecialtaxtreatment.

4. Employer Stock or Securities Thereisaspecialruleforapayment

fromthePlanthatincludesemployerstock(orotheremployersecurities).Tousethisspecialrule:(1)thepaymentmustqualifyasalump-sumdistribu-tion,exceptthatyoudonotneedfiveyearsofPlanparticipation;or(2)theemployerstockincludedinthepaymentmustbeattributableto“after-tax”employeecontributions,ifany.Underthisspecialrule,youmayhavetheoptionofnotpayingtaxonthe“netunrealizedappreciation”ofthestockuntilyousellthestock.NetunrealizedappreciationgenerallyistheincreaseinthevalueoftheemployerstockwhileitwasheldbythePlan.Forexample,ifemployerstockwascontributedtoyourPlanaccountwhenthestockwasworth$1,000butthestockwasworth$1,200whenyoureceivedit,youwouldnothavetopaytaxonthe$200increaseinvalueuntilyoulatersoldthestock.

Youmayinsteadelectnottohavethespecialruleapplytothenetunreal-izedappreciation.Inthiscase,yournetunrealizedappreciationwillbetaxedintheyearyoureceivethestockunlessyourolloverthestock.Thestock(includinganynetunrealizedappreciation) can be rolled over to a Traditional IRA or another eligible employerplan,eitherinadirectrolloverorarolloverthatyoumakeyourself.Generally,youwillnolongerbe able to use the special rule for net

unrealizedappreciationifyourollthestock over to a Traditional IRA or anothereligibleemployerplan.

Ifyoureceiveonlyemployerstockinapaymentthatcanberolledover,noamount will be withheld from the payment.Ifyoureceivecashorpropertyotherthanemployerstockaswellasemployerstockinapaymentthat can be rolled over, the 20% withholding amount will be based on theentiretaxableamountpaidtoyou(includingthevalueoftheemployerstockbutexcludingthenetunrealizedappreciation). However, the amount withheld will be limited to the cash or property(excludingemployerstock)paidtoyou.

Ifyoureceiveemployerstockinapaymentthatqualifiesasalump-sumdistribution,thespecialtaxtreatmentfor lump-sum distributions described above(suchas10-yearaveraging)alsomayapply.SeeIRS Form 4972, Tax on Lump-Sum Distributions, for additional information on these rules.

D. Surviving Spouses, Alternate Payees and Other Beneficiaries

Ingeneral,therulessummarizedabovethatapplytopaymentstoemployeesalsoapplytopaymentstosurvivingspousesofemployeesandtospousesorformerspouseswhoare“alternatepayees.”Youareanalternatepayeeifyourinterestinthe Plan results from a Qualified Domestic Relations Order (QDRO), which isanorderissuedbyacourt,usuallyinconnection with a divorce or legal separation.

Ifyouareasurvivingspouseoranalternatepayee,youmaychoosetohaveapaymentthatcanberolledover(1)paidin a direct rollover to a Traditional IRA or RothIRAortoaneligibleemployerplanor(2)paiddirectlytoyou.Ifyouhavethepaymentpaidtoyou,youcankeepitor

rollitoveryourselftoaTraditionalIRAorRothIRAoraneligibleemployerplan.Thus,youhavethesamechoicesastheemployee.

Ifyouareanonspousebeneficiary,youmaydirectlyrolloverthepaymenttoaninherited Traditional IRA or have the paymentpaidtoyou.Ifyouhavethepaymentpaidtoyou,youcannotrollitover to an inherited IRA.

Ifyouareasurvivingspouse,analternatepayeeoranotherbeneficiary,yourpaymentisgenerallynotsubjecttotheadditional10%tax,evenifyouareyoungerthanage59½.

Ifyouareasurvivingspouse,analternatepayeeoranotherbeneficiary,youmaybeabletousethespecialtaxtreatment for lump-sum distributions and thespecialruleforpaymentsthatincludeemployerstock.Ifyoureceiveapaymentbecauseoftheemployee’sdeath,youmaybeabletotreatthepaymentasalump-sumdistributioniftheemployeemet the appropriate age requirements, whetherornottheemployeehadfiveyearsofparticipationinthePlan.

II. How to Obtain Additional Information Thisnoticesummarizesonlythefederal(not

stateorlocal)taxrulesthatmightapplytoyourpayment.TherulesdescribedarecomplexandcontainmanyconditionsandexceptionsthatarenotincludedinthisSpecialTaxNotice.Therefore,youmaywanttoconsultwithyourPlanAdministratororaprofessionaltaxadvisorbeforeyoutakeapaymentofyourbenefitsfromyourPlan.Also,morespecificinformationonthetaxtreatmentofpaymentsfromqualifiedemployerplansisavailableinIRS Publication 575, Pension and Annuity Income, and IRS Publication 590, Individual Retirement Arrangements. You can obtain these publicationsfromyourlocalIRSoffice,theIRSwebsiteatwww.irs.govorbycalling1-800-TAX-FORM.

Page 5 of 5

WB

State Income Tax Withholding Informationfor Qualified Retirement Plans

This general information is provided to help you understand state income tax withholding requirements for qualified retirement plan distributions. While Schwab makes every effort to obtain information about state tax laws from sources believed to be reliable, Schwab cannot guarantee the accuracy or timeliness of state tax withholding information because state tax laws are subject to constant change and interpretation. We recommend that you contact your tax advisor regarding your tax withholding elections, and to answer any questions that you may have regarding your state’s withholding laws.

Schwab may be required to withhold state tax from your distribution based upon state tax law for your state of residency. Your state of residency is determined by the legal address of record on your account. In some cases, you may elect not to have withholding apply, or you may elect to increase the rate of withholding. In other cases, state tax withholding is not available. Please refer to the chart below.

©2006 Charles Schwab & Co., Inc. All rights reserved. Member SIPC.Schwab Institutional is a division of Charles Schwab & Co., Inc. FTA 02586 (1106-8352) REG35052SIPDF-03 (11/06)

If your state of residency is:

Your withholding options are:

DE, IA, KS, MA, MD, ME, NE

If you elect to have federal income tax withheld, Schwab is required to withhold state income tax.

If you do not elect to have federal income tax withheld, you may optionally elect to have state income tax withheld.

You may provide a percentage amount equal to or greater than your state’s minimum withholding requirements; otherwise Schwab will automatically apply your state’s applicable minimum withholding requirements.

AR, CA, GA, NC, OK, OR, VA, VT

If you elect to have federal income tax withheld, Schwab is required to withhold state income tax unless you specifically elect not to have state income tax withheld.

You may provide a percentage amount equal to or greater than your state’s minimum withholding requirements; otherwise Schwab will automatically apply your state’s applicable minimum withholding requirements.

AL, AZ, CO, CT, DC, ID, IL, IN, KY, LA, MI, MN, MO, MT, ND, NJ, NM, NY, OH, PA, RI, SC, UT, WI, WV

State income tax withholding is voluntary regardless of whether or not you elect to have federal income tax withheld. Schwab will withhold state income tax only if you instruct us to do so.

You may provide a percentage amount equal to or greater than your state’s minimum withholding requirements; otherwise Schwab will apply your state’s applicable minimum withholding requirements.

AK, FL, HI, MS, NH, NV, SD, TN, TX, WA, WY

State income tax withholding is not available. Schwab will not withhold state income tax even if you elect to withhold state income tax.

If your state of residency is:

Your minimum tax rate is:

AR, DE, IA, KS, ME, NE, OK

At least 5% of the gross distribution amount

CA, GA At least 2% of the gross distribution amount

MA, NM At least 5.3% of the gross distribution amount

MD At least 7.75% of the gross distribution amount

MI At least 3.9% of the gross distribution amount

MN At least 6.25% of the gross distribution amount

MO At least 6% of the gross distribution amount

NC, VA At least 4% of the gross distribution amount

NJ There is no minimum tax rate. You may provide a percentage that equals at least $10.00 of the gross distribution amount.

OH At least 3.5% of the gross distribution amount

OR At least 8% of the gross distribution amount

PA At least 3.07% of the gross distribution amount

UT At least 2.3% of the gross distribution amount

VT At least 2.7% of the gross distribution amount

WI At least 4.6% of the gross distribution amount

WV At least 3% of the gross distribution amount

AL, AZ, CO, CT, DC, ID, IL, IN, KY, LA, MT, ND, NY, RI, SC

There is no minimum tax rate. You may provide any percentage amount.

AK, FL, HI, MS, NH, NV, SD, TN, TX, WA, WY

State income tax withholding is not available.

WB

Qualified Retirement Plan (QRP) and Keogh Distribution Request … · 2010. 3. 24. · A. From a...

Documents

Transcript of Qualified Retirement Plan (QRP) and Keogh Distribution Request … · 2010. 3. 24. · A. From a...