403(b) to Spouse <59.5
Client age 60 died with a 403(b); spouse age 52 is bene. It is my understanding she can have the funds transferred to an inherited IRA, assuming the plan allows. As a spouse, she would not have to begin distributions until he would have been 70 1/2. However as soon as she is past 59 1/2, she can roll it to her own IRA. Is this correct?
Permalink Submitted by Denise Appleby on Wed, 2007-09-12 18:30
The rollover to a beneficiary IRA option is not available to a spouse. The same QRP rules apply. I know there are PLRs that permit spousal rollovers to inherited IRAs, but I am not aware of any custodian who does so unless the beneficiary has his/her own PLR.
She can keep it in an inherited 403(b) and need not begin distributions until he would have reached age 70 ½. The drawback is that her investments would be limited, unless it is a retirement income account [ under 403(b)(9)] . She can make a rollover to her ‘own’ IRA.