Have a client who is a non-spouse beneficiary of a TIAA account that was annuitized.  They are qualified dollars.  TIAA says her only two options are to take a lump sum distribution of the commuted value or continue the period certain payments for a period of 5 years 11 months.  The imputed interest rate on continuing the payments is about 1.5% and entire balance out over less than 6 years.  They said since contract was annuitized and she is non spouse they will not allow rollover of funds into INH IRA.

Question is– can we take a lump sum distribution and roll the dollars into an Inherited IRA within 60 days (they did say we can take 0% withholding, not a mandatory withholding requirement)–or is there a reason because these are inherited dollars from an annuitized contract that we can’t do the 60 day rollover to keep the funds tax deferred and distribute to her over 10 years?