Annuity Owner Dies After Electing Lump Sum Option

Annuity owner wife elects lump sum option. Wife establishes rollover IRA with Vanguard, and coordinates with annuity company, and check is issued by annuity company to “Vanguard, for benefit of [wife] IRA.” Wife dies and 2 days later the check arrives to husband and wife’s home. About 45 days have passed since Wife died.
Husband, who was named beneficiary of the annuity contract, eventually contacts Vanguard, and they tell him they won’t take the check since wife died. Husband contacts annuity company and they say they can only issue the check to wife’s estate, not to husband as primary beneficiary so husband can rollover to his IRA.
Husband does not want to open estate, Wife’s only asset was annuity, and Wife had some debts in her name alone.
Thoughts on options. Thanks.



Does wife have a will naming husband as executor and sole beneficiary? 

  • Here is an article by noted authority Natalie Choate regarding prior IRS PLRs on this subject. Start on p 6. But a PLR should generally be the last choice because they cost around 20k and take a considerable time.
  • Death&Taxes2019.pdf (epcnnj.org)
  • Several private letter rulings permit an executor of an estate to complete a rollover.  PLRs 201514020 (which I obtained and which Natalie cites in her outline), 201334046, 200502050, 200420037, 200415011, 
  • See my article on this in the June 2015 issue of Trusts & Estates:  https://www.kkwc.com/wp-content/uploads/2015/08/IRA-Rollovers-Making-this-option-possible.pdf.
  • Bruce Steiner

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