NUA Distribution at T. Rowe Price Workplace Retirement: Step-by-Step Process

T. Rowe Price administers retirement plans for hundreds of employers, including many large industrial, financial, and government-contractor companies whose long-tenured employees have accumulated decades of appreciated employer stock. If your 401(k) is recordkept by T. Rowe Price, here's exactly how the NUA election works — how to locate your cost basis, what to request when you call, how the in-kind transfer is processed, and what your 1099-R Box 6 must show. This is not investment or tax advice for your specific situation.

T. Rowe Price Workplace Retirement and the NUA process

T. Rowe Price's retirement plan recordkeeping business operates under its Workplace Retirement division, which is entirely separate from its mutual fund and individual brokerage services. Plan participants access their accounts through the T. Rowe Price participant portal — typically via a link from your employer's HR or benefits site, or directly at T. Rowe Price's workplace retirement portal. The participant services phone number for workplace plans is printed on your plan statement and is distinct from the retail investor services line.

T. Rowe Price's default distribution path is the same as every major recordkeeper: cash, IRA rollover, or annuity. An in-kind employer stock distribution — where shares move to a taxable brokerage account without being liquidated — is not a standard online workflow. It requires a specific phone request to T. Rowe Price's Workplace Retirement distribution team. Allowing the default process to proceed, or using ambiguous language when you call, will result in employer stock being sold or rolled to an IRA, permanently forfeiting the NUA election.

T. Rowe Price serves many long-tenure employees at large industrials, utilities, defense contractors, and financial firms. Positions built up over 20–35 years of employer contributions at companies that performed well over the same period frequently represent very low cost basis relative to today's value — the scenario where NUA provides the largest tax advantage.

Step 1 — Locate your employer stock cost basis in the T. Rowe Price participant portal

The cost basis for NUA purposes is the plan's acquisition cost — the price the plan paid per share when employer contributions were made to your account over the years. This is not the current market price, not your brokerage average-cost basis, and not the price on any particular grant date. For a multi-decade position built through annual profit-sharing or employer matching contributions, the plan cost basis is typically a fraction of today's share price.

• Log in to the T. Rowe Price participant portal using the link provided by your employer or through your employer's benefits site. Navigate to your investment summary or account holdings.
• Look for the employer stock position by company name or ticker. T. Rowe Price may display a "cost basis" figure on the account detail screen. If shown, confirm it represents the plan's acquisition cost per share — the price at which the plan purchased the shares on your behalf — not the current price or a reinvested dividend basis.
• If cost basis is not clearly labeled or you are uncertain about what the figure represents: call T. Rowe Price Workplace Retirement participant services and request the "plan cost basis per share of [employer name] stock for NUA purposes." Ask them to confirm it in writing — a mailed statement or email showing the lot-level cost basis used for 1099-R Box 6 reporting.
• For participants with contributions spanning multiple recordkeeper transitions (plans that switched to T. Rowe Price from another provider), ask specifically whether the cost basis data covers the full contribution history or only the period since T. Rowe Price assumed recordkeeping. Incomplete basis records can produce an overstated basis figure, reducing your NUA benefit.

Step 2 — Open a receiving taxable brokerage account

The in-kind employer stock must be delivered to a regular taxable brokerage account. Receiving it in any IRA — including a rollover IRA, Roth IRA, or inherited IRA — permanently destroys the NUA election for those shares.

• If you want to keep assets consolidated: T. Rowe Price offers an individual brokerage account through T. Rowe Price Investment Services. Opening a taxable account there before you call simplifies the transfer — T. Rowe Price can process an internal transfer from the workplace 401(k) record to a T. Rowe Price taxable brokerage account, which is faster and involves less coordination than sending shares to an outside firm.
• If you prefer a different custodian (Schwab, Fidelity, Vanguard, Merrill): an external transfer via DTC is possible. You will need the receiving broker's DTC participant number and your account number at that broker. External transfers typically take 3–7 business days and introduce additional processing coordination — factor this into your December 31 timeline if initiating late in the year.
• Open the receiving account before calling T. Rowe Price to initiate the distribution. Having the account number ready streamlines the call and reduces the risk of a processing error caused by unclear delivery instructions.
• Double-check that the receiving account is a taxable individual or joint account — not an IRA, SEP-IRA, SIMPLE IRA, Roth IRA, or any other tax-advantaged vehicle. If you already have a T. Rowe Price IRA, confirm the account type before providing the account number on the distribution call.

Step 3 — Call T. Rowe Price Workplace Retirement participant services

In-kind distributions must be initiated by phone with T. Rowe Price's Workplace Retirement team — not through the online portal, and not by calling T. Rowe Price's individual investor line. The participant services number for workplace plans appears on your quarterly plan statement, in the plan participant portal under "Contact Us," or in your summary plan description. Do not use the retail investor phone number listed on the main T. Rowe Price website — that line handles mutual fund and individual brokerage accounts, not 401(k) plan distributions.

When you reach a Workplace Retirement distribution representative, use these exact phrases:

• "I want to take a lump-sum distribution triggered by my separation from service [or age 59½ / disability / death of participant]."
• "I want to distribute the employer stock in-kind — transfer the shares to my taxable brokerage account without selling them."
• "I want to roll the remaining non-stock plan balance over to an IRA."
• "I am electing Net Unrealized Appreciation treatment on the employer stock under IRC § 402(e)(4)."

Precise language — "lump-sum distribution," "in-kind," "NUA," "IRC § 402(e)(4)" — routes your request to personnel trained in non-standard distributions and signals that this is not a routine rollover. If the representative is unfamiliar with NUA or attempts to process a standard rollover instead, ask specifically to speak with a "distribution specialist" or ask to be transferred to the team that handles lump-sum employer stock distributions. Do not let a routine rollover proceed.

Step 4 — Address the Self-Directed Brokerage Account (SDBA), if applicable

Some T. Rowe Price–administered 401(k) plans offer a Self-Directed Brokerage Account (SDBA), sometimes branded under a third-party platform that integrates with the plan. The SDBA gives participants the ability to hold individual securities, ETFs, or other non-fund investments within the plan.

• Shares of employer stock held in the SDBA are still plan assets — they are inside your 401(k), not in a taxable account, despite the "brokerage" label. For NUA purposes, SDBA employer stock is subject to the same lump-sum distribution and in-kind transfer requirement as employer stock held in the standard plan investment menu.
• When you call to initiate the distribution, specify whether your employer stock is held in the main plan investment elections or in the SDBA. T. Rowe Price's distribution team will need to coordinate the in-kind transfer from the appropriate account location.
• Do not sell employer stock within the SDBA before or during the distribution process. Selling inside the plan — even within a brokerage-style window — converts the gain to ordinary income and permanently eliminates the NUA election for those shares.

Step 5 — Confirm distribution instructions in writing

Before ending the call, ask T. Rowe Price to provide written confirmation of the distribution instructions — by mail or email. This document should specify:

• That the employer stock will be transferred in-kind (as shares, not cash) to your taxable brokerage account, with the specific account number
• That the remaining plan balance will be rolled over to your IRA, with the receiving IRA custodian and account number
• The qualifying event triggering the lump-sum distribution
• The expected settlement timeline for both legs

Written confirmation is your protection if either leg is processed incorrectly — stock sold instead of transferred in-kind, balance directed to the wrong account, or the December 31 same-year deadline missed due to a processing delay. A documented request gives you grounds to escalate or request a corrected 1099-R if the distribution is reported inaccurately.

Step 6 — Complete both legs before December 31

The lump-sum distribution requirement means the entire plan balance must leave the plan within a single calendar year. Both legs must settle before December 31 of the distribution year:

• The in-kind employer stock transfer to your taxable brokerage account
• The IRA rollover of the remaining plan balance to your receiving IRA custodian

Internal transfers — from the T. Rowe Price 401(k) record to a T. Rowe Price taxable brokerage account — typically settle in 1–3 business days. External DTC transfers to a different broker (Schwab, Fidelity, Vanguard, Merrill) typically take 3–7 business days. IRA rollovers to external custodians take a similar 3–7 days.

If you are initiating in November or December, explicitly flag the December 31 deadline on the call and ask T. Rowe Price to confirm that both legs will settle in the current calendar year. After the distribution is processed, verify in both the T. Rowe Price participant portal (the plan balance should reach $0) and your receiving brokerage account (shares should appear, not cash) that both legs settled correctly. Do not assume completion — check each account.

Step 7 — Verify your 1099-R from T. Rowe Price

T. Rowe Price will issue a Form 1099-R in January of the year following the distribution. For an NUA election, the boxes must be populated as follows:¹

If Box 6 is missing, or if Box 2a equals Box 1 (indicating the full fair market value is being reported as ordinary income), T. Rowe Price has not correctly identified the NUA amount. Do not file your return based on an incorrect 1099-R. Contact T. Rowe Price Workplace Retirement to request a corrected form — and if necessary, ask their tax document correction team to escalate. Filing with an incorrect 1099-R means paying ordinary income tax on the entire stock value instead of capital gains rates on the NUA amount.

Common T. Rowe Price–specific pitfalls

Calling the individual investor line instead of Workplace Retirement

T. Rowe Price's individual investor services and its workplace retirement plan administration are separate operating units with separate phone systems. A representative on the individual investor line cannot initiate, modify, or query a 401(k) plan distribution — they have no access to your plan account. If you accidentally reach the wrong line and that representative attempts to help (by moving assets, initiating a rollover, or providing instructions), you risk a misdirected or improperly documented transaction. Use only the plan participant services number from your statement or the participant portal.

Incomplete cost basis from a prior recordkeeper transition

Many plans have switched recordkeepers over the decades. If your employer moved its retirement plan to T. Rowe Price from a prior provider (Principal, Transamerica, Voya, Aon Hewitt, or another firm), the cost basis data transferred during the transition may be incomplete, estimated, or contain gaps — particularly for long-tenured employees who accumulated employer stock before T. Rowe Price assumed recordkeeping. Before initiating the distribution, ask T. Rowe Price to confirm in writing that the cost basis figure covers the full plan history, and compare it to any historical benefit statements or contribution records you have retained. An overstated cost basis reduces your NUA benefit; an understated one underestimates your tax bill on the ordinary income portion.

SDBA employer stock sold before distribution

If your plan includes a self-directed brokerage account window and your employer stock sits in the SDBA, do not sell it before or during the distribution under the assumption that you're "already in a brokerage account." SDBA shares are plan assets. Selling them converts the appreciation to ordinary income upon distribution and permanently forfeits NUA treatment. Keep employer stock as shares through the entire in-kind transfer process.

Stock liquidated automatically on distribution initiation

Some plan configurations instruct the recordkeeper to liquidate all positions to cash when a distribution is initiated. If T. Rowe Price liquidates the employer stock before you can specify "in-kind," the NUA election is permanently lost. When you call, confirm explicitly — before the request is submitted — that the employer stock will be transferred as shares (not cash). After the transfer is processed, verify within 1–3 business days that shares (not a cash balance) appear in your receiving brokerage account.

Employer stock accidentally included in the IRA rollover

When T. Rowe Price processes the IRA rollover of your remaining non-stock plan balance, there is a risk that employer stock is inadvertently captured in the rollover — particularly if distribution instructions were not precisely specified or if a processing error routes shares to the IRA account instead of the taxable account. Any employer stock that enters an IRA permanently loses NUA treatment for those shares.² After the distribution settles, verify the in-kind transfer amount (shares in the taxable account) and the IRA rollover amount separately to confirm no stock was misdirected.

Missing the December 31 same-year lump-sum deadline

If the IRA rollover leg settles in January of the following year while the in-kind stock transfer settled in December, the lump-sum distribution spans two calendar years. This technically disqualifies the NUA election. If you are initiating in November or December, build in a 2–3 week buffer, flag the year-end deadline explicitly when calling, and ask T. Rowe Price to confirm expected settlement dates for both legs. Do not initiate after December 10 without confirming that both legs will close before January 1.

After the transfer: next steps

Once employer stock appears as shares in your taxable brokerage account:

• The NUA amount qualifies as deemed long-term capital gain when the shares are eventually sold — regardless of how long you hold them after the distribution. Post-distribution price appreciation beyond the NUA amount will be short-term if sold within one year of the distribution date, long-term after one year. Most situations favor holding at least one year after distribution to convert post-distribution gains to long-term rates.
• Review your post-NUA diversification strategy — tranche selling to stay in lower LTCG brackets, direct charitable donation of appreciated shares, holding for estate step-up, and 0% LTCG bracket harvesting are all worth modeling with a specialist.
• The 1099-R Box 6 amount is reported on Schedule D as a deemed long-term capital gain in the tax year the shares are sold — not the year of distribution. See the NUA tax reporting guide for the mechanics of the two-year reporting sequence.
• Other custodian guides: Fidelity · Empower · Vanguard · Schwab · Merrill Lynch · Principal.