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New Member
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Jan 6, 2013, 10:31 AM
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ESOP, company being bought out/taken over
I have an ESOP plan with a former employer. That company has now been bought out. I was originally told I could not withdrawal the money till I had been away from the company for 5 years. I left the company in 2009... but now the company has been bought out. I am on disability, and was told that I could now withdraw the money. How do I do this and will there be penalties?
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Senior Tax Expert
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Jan 6, 2013, 12:58 PM
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There should be no penalties UNLESS the ESOP is part of a pension plan and you are below the age of 59.5. Even then, your disability status will likely waive any penalties.
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Computer Expert and Renaissance Man
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Jan 6, 2013, 01:05 PM
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You need to contact the HR dept at the company that is buying your old company. It sounds like they are terminating the plan which is what is allowing you to get a distribution. You should have gotten a letter from the buying company or plan administrator with instructions.
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New Member
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Jan 6, 2013, 01:11 PM
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I haven't received anything yet... the new company took over on the 1st of January... and from what I understand... one of the people in the HR department was kept. Should I contact them on Monday or give the mail a few more days?
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Senior Tax Expert
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Jan 6, 2013, 01:44 PM
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Call.
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Computer Expert and Renaissance Man
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Jan 6, 2013, 02:28 PM
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Then what makes you think they are closing the account? But yes call Monday morning.
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New Member
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Jan 8, 2013, 09:30 AM
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A friend of mine who use to work there and was laid off because of the take over told me they were, but that she and several others were not going to get anything out of it. I also have found out that the company has failed to pay certain taxes that they were suppose to pay... mainly it seems FICA and unemployment...
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Senior Tax Expert
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Jan 8, 2013, 10:38 AM
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If you feel so inclined, you can report them using the Tax Fraud Hotline, gthe phone number for which can be found on Internal Revenue Service.
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New Member
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Jan 8, 2013, 10:45 AM
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Thank you... I'm thinking that I should... there are a lot of people that I know that had been with the company for almost 20 years that were just shown the door.. no severance, they lost any vacation/sick time they still had... just told at the end of business on Monday, that they were out of a job...
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Senior Tax Expert
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Jan 8, 2013, 10:47 AM
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The sick time probably cannot be recovered, but a phone call to the state Department of Labor may get them reimbursed for their lost vacation time.
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New Member
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Jan 8, 2013, 10:51 AM
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Thank you so much for your help... I will forward the info...
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Senior Tax Expert
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Jan 8, 2013, 11:53 AM
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Glad to help!
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