Non-Spouse Beneficary R/O
If a non-spouse inherited a qualified plan in 2002 and has been taking life expectancy distributions (owner had reached RBD) each year, are they eligible to rollover (via a trustee-to-trustee transfer) the assets to a beneficiary IRA? I know, in general, that this can be done, but was concerned by the fact that the beneficiary inherited the account in 2002 long before PPA & WRERA came into effect.
So, again, my question is: Does it matter when the beneficiary inherited the qualified plan for the purposes of transacting a rollover (via a trustee-to-trustte transfer) to a beneficiary IRA?
Permalink Submitted by Alan Spross on Fri, 2011-04-01 20:23
It does not matter how far back the employee died. The only restrictions per Sec 829 of the PPA was that the direct rollover itself must be after 12/31/2006. And WRERA made the offering of these non spouse beneficiary direct rollovers mandatory.
Accordingly, the current year RMD should be distributed from the plan and then the balance can be directly rolled to an inherited TIRA or for that matter to an inherited Roth IRA.
Permalink Submitted by Alanna Crawford on Fri, 2011-04-01 20:37
Great- thank you!