May a 401(k) plan document establish a normal retirement age (NRA) of less than 59½ to create a distributable event for elective deferrals?
Rev. 09/01/05 E-mail Alert 2005-17

No. The regulations do not permit the in-service distribution of elective deferrals prior to age 59½. Because reaching NRA is normally a distributable event, some employers hoped that lowering the NRA would open the door for a triggering event that would allow participants to receive distribution of elective deferrals prior to age 59½ while still working. The IRS has made it clear that this is not permitted.