The Walmar 401(k) Plan
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2018 Associate Benefits Book | Questions? Log on to WalmartOne.com or the WIRE, or call People Services at 800 -421-1362
from the Plan during 2010 that are rolled over to a Roth
IRA, the taxable amount can be spread over a two-year
period starting in 2011. If you roll over the payment to
a Roth IRA, later payments from the Roth IRA that are
qualified distributions will not be taxed (including earnings
after the rollover). A qualified distribution from a Roth IRA
is a payment made after you are age 59½ (or after your
death or disability, or as a qualified first-time homebuyer
distribution of up to $10,000) and after you have had a Roth
IRA for at least five years. In applying this five-year rule,
you count from January 1 of the year for which your first
contribution was made to a Roth IRA. Payments from the
Roth IRA that are not qualified distributions will be taxed
to the extent of earnings after the rollover, including the
10% additional income tax on early distributions (unless
an exception applies). You do not have to take required
minimum distributions from a Roth IRA during your lifetime.
For more information, see IRS Publication 590, Individual
Retirement Arrangements (IRAs).
You cannot roll over a payment from the Plan to a
designated Roth account in an employer plan.
If you are not a plan paricipant
Payments after death of the participant. If you receive a
distribution after the participant’s death that you do not
roll over, the distribution will generally be taxed in the same
manner described elsewhere in this notice. However, the
10% additional income tax on early distributions does not
apply, and the special rule described under the section If
you were born on or before January 1, 1936 applies only if
the participant was born on or before January 1, 1936.
If you are a surviving spouse: If you receive a payment from
the Plan as the surviving spouse of a deceased participant,
you have the same rollover options that the participant
would have had, as described elsewhere in this notice. In
addition, if you choose to do a rollover to an IRA, you may
treat the IRA as your own or as an inherited IRA.
An IRA you treat as your own is treated like any other IRA
of yours, so that payments made to you before you are age
59½ will be subject to the 10% additional income tax on early
distributions (unless an exception applies) and required
minimum distributions from your IRA do not have to start
until after you are age 70½.
If you treat the IRA as an inherited IRA, payments from
the IRA will not be subject to the 10% additional income
tax on early distributions. However, if the participant had
started taking required minimum distributions, you will
have to receive required minimum distributions from the
inherited IRA. If the participant had not started taking
required minimum distributions from the Plan, you will not
have to start receiving required minimum distributions
from the inherited IRA until the year the participant would
have been age 70½.
If you are a surviving beneficiary other than a spouse:
If you receive a payment from the Plan because of the
participant’s death and you are a designated beneficiary
other than a surviving spouse, the only rollover option you
have is to do a direct rollover to an inherited IRA or Roth
IRA. Payments from the inherited IRA or Roth IRA will
not be subject to the 10% additional income tax on early
distributions. You will have to receive required minimum
distributions from the inherited IRA or Roth IRA.
Payments under a qualified domestic relations order. If
you are the spouse or former spouse of the participant
who receives a payment from the Plan under a qualified
domestic relations order (QDRO), you generally have the
same options the participant would have (for example, you
may roll over the payment to your own IRA or an eligible
employer plan that will accept it). Payments under the
QDRO will not be subject to the 10% additional income tax
on early distributions.
If you are a nonresident alien: If you are a nonresident
alien and you do not do a direct rollover to a U.S. IRA or
U.S. employer plan, instead of withholding 20%, the Plan
is generally required to withhold 30% of the payment for
federal income taxes. If the amount withheld exceeds the
amount of tax you owe (as may happen if you do a 60-day
rollover), you may request an income tax refund by filing
Form 1040NR and attaching your Form 1042-S. See Form
W-8BEN for claiming that you are entitled to a reduced
rate of withholding under an income tax treaty. For more
information, see also IRS Publication 519, U.S. Tax Guide
for Aliens, and IRS Publication 515, Withholding of Tax on
Nonresident Aliens and Foreign Entities.
If you have Roth contributions that were merged into the
Walmart 401(k) Plan, those contributions are subject to
special tax rules when they are distributed from the Walmart
401(k) Plan. In general, your Roth contributions are not taxed
upon distribution, even if you do not elect a rollover.
Earnings on those contributions are also not taxed if
the distribution is a “qualified distribution.” A “qualified
distribution” is a payment made after age 59½ (or after your
death or disability) and after you have had a Roth account for
at least five years (counting from January 1 of the year you
made your first Roth contribution). If the distribution is not
a qualified distribution, the earnings will be taxed and, if you
are under 59½ (and no other exception applies), the additional
10% income tax would also apply, unless you elect a rollover.
You may roll over your Roth contributions only to a Roth
IRA or to a designated Roth account in another employer
plan that will accept the rollover. The rules of the Roth IRA
or employer plan that holds the rollover will determine your
investment options, fees, and rights to payment from the
Roth IRA or employer plan (for example, no spousal consent