My question is re: a non spouse beneficiary of a 401(k) plan – participant died last month (Jan ’09) with non spouse primary beneficiary and no contingent beneficiary. Plan administrator says they will establish an account for the beneficiary and move the balance to it. If they do this, will this preclude the beneficiary from qualifying for a transfer to a non spousal beneficiary IRA that would allow her to stretch out the distributions? The TPA service person I talked to didn’t know what I was talking about re: the new rules re: allowing non spousal transfers to beneficiary IRAs so I assume the plan hasn’t been changed to allow this or this service person didn’t know about it.

If the plan doesn’t currently allow transfers to beneficiary IRAs for non spouse beneficiaries, can the beneficiary wait until 2010 when it will be mandatory? And if the plan moves the funds to an account in the beneficary’s name will she still be eligible for this transfer which will need to be an account in the deceased participant’s name?

What if she requests a distribution from the plan before the transfer?

Thanks for your help!