Estate as 401k Beneficiary
If a beneficieary spouse passes away before naming a primary beneficiary, does her estate have to receive the complete account as a taxable distribution? Are there any rollover provisions for the estate to delay the complete taxation of the 401k?
Thanks,
Justin
Permalink Submitted by Alan - IRA critic on Wed, 2017-09-27 19:03
That depends on the plan provisions. Almost all of them will require a lump sum distribution to the estate within a certain time frame. There are no rollover options for the estate under IRS rules. If she had named her own beneficiary, there still could not be a rollover but a few plans may have been willing to let her take RMDs over surviving spouse’s life expectancy.
Permalink Submitted by Justin Whelan on Wed, 2017-09-27 21:31
Alan, You have answered two questions for me recently. Thanks, Justin