A Newkirk news release said that the system includes software that identifies terminated low balance participants and sends the participant information to Newkirk, which then prepares and distribute participant notices that satisfy the DOL and IRS communication requirements.
The announcement said that if the participants take no action with respect to their account balances within 30 days (or some longer period specified by the provider), Newkirk will then target the participants for distribution processing by first creating an electronic file with the required data and then returning the file to the provider for confirmation and final processing.
The provider then forwards the file to Wealth Management Systems, Inc., a plan rollover provider, which facilitates the creation of the IRAs with its financial services partners. The Automatic Rollover IRA used for this solution meets all of the government’s requirements for automatic rollovers, the news release said.
“The government’s new rules governing mandatory distributions have put both providers and plan sponsors in a bind,” said Peter Newkirk, president of Newkirk. “The need to create rollover accounts to receive such distributions and to meet the participant notice requirements have led many providers and sponsors to conclude that eliminating or amending mandatory distribution provisions is their only option. Our Automatic Rollover Solution provides an alternative.”
For more information about Newkirk’s Automatic Rollover Solution, call 518-862-3325 or e-mail at firstname.lastname@example.org .
The new offering comes as the new automatic rollover rules are scheduled to go into effect. Come March 28, plans with mandatory distribution provisions will have to have something in place to deal with distributions of more than $1,000 for which distribution instructions aren’t provided (See IRS, Treasury Issue Automatic Rollover Guidance ).