Dealing with Missing Participants in Terminating Defined Contribution Plans (Posted June 22, 1999) Technical Tip 7: The following question and answer were reprinted from the IRS Q&A Session at the 1998 ASPPA Annual Conference: What constitutes a satisfactory method to distribute account balances (both less than and greater than $5,000) to lost participants in a terminated DC (defined contribution) plan? IRS Response: We believe the best answer is a statutory one (such as allowing PBGC to accept these payments). In the interim, all we can recommend is that you do whatever is reasonable, knowing that we understand that this is a difficult issue under the current statutory framework. Comment by the RLR&C ERISA Attorneys: IRS officials have informally acknowledged at various conferences that the current statutory framework is unworkable for handling missing participants in terminating defined contribution plans. Thus, this answer suggests that the IRS will not disqualify plans in such situations where a "reasonable" course of action is taken. Of course, informal statements by IRS officials are not the law and, accordingly, will not protect plans on audit. However, such statements may reflect the IRS' current enforcement policy. View all Tips © 1999-2012 Reish Luftman Reicher & Cohen, a Professional Corporation Important notice: Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner's situation. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of your situation.