Divorced Surviving Spouse
Situation – a couple is legally divorced and a court order prevents the man from changing his IRA beneficiaries or depleting the accounts. He dies. Is the ex-wife the surviving spouse with rights to make it her own? Or must she create an inherited IRA? She is named as 50% primary beneficiary with each of her two children being named as 25% primary beneficiaries.
Permalink Submitted by Anonymous (not verified) on Wed, 2009-02-18 03:43
This would be an unusual court order. If the IRA owner cannot touch the account, the IRA should be ordered partially transferred incident to divorce. Based on the following provision in the IRS Regs under which IRAs basically follow the 401a9 provisions, she would have to set up a non spouse inherited IRA with her share.
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Q–5. Who is an employee’s spouse or surviving spouse for purposes of section 401(a)(9)?
A–5. Except as otherwise provided in A–6(a) of this section (in the case of distributions of a portion of an employee’s benefit payable to a former spouse of an employee pursuant to a qualified domestic relations order), for purposes of section 401(a)(9), an individual is a spouse or surviving spouse of an employee if such individual is treated as the employee’s spouse under applicable state law. In the case of distributions after the death of an employee, for purposes of determining whether, under the life expectancy rule in section 401(a)(9)(B)(iii) and (iv), the provisions of section 401(a)(9)(B)(iv) apply, the spouse of the employee is determined as of the date of death of the employee.
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Permalink Submitted by Al Fry on Wed, 2009-02-18 16:05
Mistook the topic for a spam singles ad.