Q. When may I receive a distribution from my Savings Plan Account?
A. Your Savings Plan Account generally may be distributed to you when your employment ends. The timing and form of your distribution depend on the value of your account and whether or not you are a retiree. In addition, employees age 55 or older with at least 10 years of Savings Plan participation may be eligible to receive a diversification distribution of a portion of their Stock Match Account.
Distributions to current employees
Generally, amounts allocated to your Stock Match Account must remain there until the final distribution of your Savings Plan Account or conversion to the Roth Conversion Account. However, you may elect to receive a distribution of a portion of your Stock Match Account, known as a diversification distribution, if you:
- Are at least age 55;
- Have completed at least 10 years of Savings Plan participation; and
- Are still employed on the last day of the calendar year.
The actual election and distribution occur in the following year. Additional information is provided when you become eligible for a Stock Match Account diversification distribution.
Distributions to retirees
If you become a retiree, your account will be distributed according to the following rules:
- If the vested value of your Savings Plan Account is $1,000 or less at the time of termination of employment or later, your vested amount is automatically distributed to you in cash to the extent you do not provide distribution instructions.
- If, on the other hand, the vested value of your Savings Plan Account is greater than $1,000, your account remains in deferral status until you elect a total account distribution or your account balance falls to $1,000 or less. You may elect to receive a total distribution of your entire account at any time.
- You may elect one partial distribution from your non-Roth accounts and one from your Roth accounts each calendar year. Electing a partial distribution does not prevent you from electing a total distribution of your account later in the same year or making a withdrawal if a withdrawal balance is available.
- If you die before your entire account is distributed and your surviving spouse is your beneficiary, he or she assumes the account and will have the same total and partial distribution options that were available to you before your death. If you die without a surviving spouse beneficiary, your account is distributed to your beneficiary.
- The law requires that you begin receiving annual minimum distributions no later than April 1 of the year following the year in which you reach age 70-1/2. These minimum distribution rules do not prevent you from continuing to defer total distribution of your account, but, rather, simply require at least a certain percentage of your account be distributed to you each year. (If your surviving spouse maintains your account past the time you would have reached age 70-1/2, minimum distribution rules will also apply.) You will receive more information concerning minimum distributions if these rules apply to you.
There are important tax considerations related to distributions from the Savings Plan.
Distributions to terminated employees
If you terminate employment but are not a retiree, your account is distributed according to the following rules:
- If the vested value of your Savings Plan Account is $1,000 or less at time of termination of employment or any time thereafter, your vested amount is automatically distributed to you in cash to the extent you do not provide distribution instructions.
- If, on the other hand, the vested value of your Savings Plan Account is more than $1,000, your account remains in deferral status until you elect a total account distribution or your account falls to $1,000 or less. You may elect to receive a total distribution of your entire account at any time.
- If you reach age 65 and your account is still deferred, it will be distributed to you. If you die while your account is deferred, it will be distributed to your beneficiary.
Your account during deferral
Following termination of employment – whether or not as a retiree – but prior to the time you take a total distribution of your Savings Plan Account, the operation of your account remains essentially the same as before your termination of employment, except for the following:
- You may make special contributions only through the end of the year in which you terminate employment.
- You may not make any other contributions to your account and, therefore, you will not receive any company match.
- No hardship withdrawals can be requested, since your account is now fully distributable.
- No new loans can be requested, but you must continue to repay outstanding loans.
How your Savings Plan Account is distributed
When you elect a total distribution of your Savings Plan Account, all of your investment options (other than ExxonMobil stock) are sold, and the proceeds distributed to you in cash. You have the option to take some or all of your shares of ExxonMobil stock in kind, or have the shares of stock liquidated and the proceeds distributed to you in cash.
If you have a loan outstanding at the time of your total distribution, the unpaid balance is deducted from your distribution.
As a retiree, you may elect to receive a partial distribution in cash, ExxonMobil stock or a combination of both. Any cash you elect to receive is funded in the following order from each account affected:
1. Common Assets
2. Indexed funds, sold on a pro-rata basis
3. ExxonMobil stock, sold from high to low cost basis.
There are important tax consequences of distributions.
Special rules for certain SeaRiver Maritime and former fuels marketing Savings Plan participants
Certain employees or former employees of these businesses will receive payment of a portion of their distribution in the form of an annuity, unless the employee elects a lump sum and the employee’s spouse waives the right to the annuity and consents to a lump-sum distribution.