My dad is 69 years old. 3 years ago, he was permanently disabled and blinded in an accident at work and is receiving workers comp payments in PA.
At age 70, he must start taking distributions from his 401k retirement account. He was 100% vested at the time of the accident, old enough to draw on it without penalty, and hasn't contributed to it since the accident.
In my opinion, his 401k account was "his money" prior to the accident and he should be able to take distributions, and pay taxes on them, without affecting his compensation. However, he wants to make sure that's the case before he draws on it a year from now.
Is his 401k distribution going to affect his compensation payments?