NUA – two different employer plans
Hi All – question on NUA possibility. Client has two previous employer 401k plans (separate companies) – both holding company stock and eligible for an NUA distribution. Are there any rules around timing of these distributions – specifically, can you do NUA on two different employer plans in the same calendar year, 12 month period, etc?
Thanks in advance!
Permalink Submitted by Alan - IRA critic on Fri, 2025-08-29 12:30
Yes, the LSDs for NUA purposes can be done in the same year or in different years, with each plan being treated as if it was the only plan holding employer shares. Client may want to consider doing these in different years to prevent the taxable cost basis of both plans from being included in income in the same year.
For both of these plans, there cannot be any distributions after the most recent triggering event and prior to the LSD year, as these would be intervening distributions that would erase the qualified LSD until there was a new triggering event.
Permalink Submitted by advisorguy on Fri, 2025-08-29 12:36
This is what I thought – truly appreciate the assistance!