### Question
How is the term lump-sum distribution defined?


### Answer
The term **lump-sum distribution** is defined in *26 U.S.C. § 402* as the following:

> the distribution or payment within one taxable year of the recipient of the balance to the credit of an employee which becomes payable to the recipient—


(I) on account of the employee's death,


(II) after the employee attains age 591/2,


(III) on account of the employee's separation from service, or


(IV) after the employee has become disabled (within the meaning of section 72(m)(7)),


  

 from a trust which forms a part of a plan described in section 401(a) and which is exempt from tax under section 501 or from a plan described in section 403(a)

#### Citation:
  - *26 U.S.C. § 402*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter D-Deferred Compensation, Etc. > PART I-PENSION, PROFIT-SHARING, STOCK BONUS PLANS, ETC. > Subpart A-General Rule**

