Keogh IRA Question
Hello, if a husband has a Keogh IRA with his wife as beneficiary. Husband passes away, can the wife treat the assets as her own and move the funds to her traditional IRA or would the funds first have to go to a Keogh IRA BDA for the wife.
Permalink Submitted by Alan - IRA critic on Wed, 2018-06-27 22:44
Hopefully, the wife will not be caught up in an IRS audit finding that the plan had not updated its forms or failed to file a 5500 in the past, as has been the case for many Keogh plans. An inherited Keogh cannot be owned by the spouse unless she plans to continue the business, but if that were the case, due to the aforementioned issues, she should terminate the plan and open a SEP IRA instead. Otherwise, she can have the inherited balance directly rolled over into an IRA or Roth IRA, including an inherited IRA if spouse is not yet 59.5. Not sure if the plan document will require a BDA before rolling out the funds to an IRA, but best avoided if the administrator allows it.