Client’s spouse died with 401-k balance excess 300K. no beneficiary named in 401-k document. The client is the estate executor and the 401 k has been distributed to herself from her spouse’s estate. The distribution has passed 60 day period. Is there still chance to rollover the amount to her own IRA instead pay tax on this with self certification waiver?
Why would it have been distributed to the deceased’s estate? Shouldn’t the default beneficiary have been the spouse, as required by ERISA? Are you sure that the distribution wasn’t made directly to the surviving spouse without any involvement of the deceased’s estate? If the distribution was made directly to the surviving spouse, there is no need to rely on PLRs to allow the rollover; only self-certification that the late rollover is waiver eligible would be needed
Permalink Submitted by Alan - IRA critic on Wed, 2018-02-14 00:39
Yes, since 60 days has passed she will have to use self certification but she also needs to rely on the various PLRs allowing the rollover in the first place. Self certification is only good for rollovers that are clearly eligible. Her chances are best using a large brokerage IRA custodian rather than a bank. But she may have to fall back on self certification if she needs it. Was there 20% withholding taken out of the distribution?