401k beneficiary was listed as estate of deceased
A 401k listed the estate of someone who has recently died. She was in her 60’s.
There are several beneficiaries. The primary beneficiary was her significant other of over 20 years. However, they never married.
Is there a way to minimize the tax impact ? Must this 401k be paid out within 5 years or lump sum ?
Permalink Submitted by Alan - IRA critic on Mon, 2013-02-04 20:18
The 5 year rule will apply here, The tax impact could be reduced if the plan agreed to make partial distributions to the estate for each year, but in this situation it’s most likely that the plan will not allow partials and will push to just distribute a lump sum to the estate before the estate closes.