401k Transfer Inherited IRA
Hello, my mother passed away and left me a 401(k). I was told to transfer to an Inherited IRA/Beneficiary IRA to a brokerage of my choice.
I have been getting conflicting information from brokerages and the company my mother worked for. Specifically concerning the check terminology. I was told to have it made out to the brokerage for the benefit of me and to also have my mothers name on it. But the company said her name would not be on it.
Does anyone have experience with this. How was the check written in your case.
Also if I am going through lets say Etrade and I fill out their inherited ira paperwork. How do I know how this will be titled. Shouldnt it be titled (mothers name) fbo (my name)? I was told the inherited IRA would be under my name.
This forum has extremely helpful and I appreciate all the support.
Permalink Submitted by Alan - IRA critic on Thu, 2021-04-29 19:56
Probably a question of semantics. Your mother’s name as decedent should be on the inherited IRA title, eg “armoose as beneficiary of (mother’s name)”. Some custodians however prefer to use the older method showing “(mother’s name), deceased, FBO of armoose, beneficiary”. So the main difference is the order. although her name must be part of the title. Set up the inherited IRA at ETrade in the manner they wish, and ask if they can request the direct rollover from the 401k plan. If it turns out the only way to transfer the money is by sending you a direct rollover check, make totally sure it is not made out to you personally, but to your inherited IRA account FBO you. Minor differences between the direct rollover check format and your inherited account title can usually be resolved.
Permalink Submitted by Alon David on Thu, 2021-04-29 23:46
Thank you this is exactly what I was looking for. Yeah I just wanted to make sure that this wasnt contingent on pinpoint exact wording. But good to know its ok both ways. Thank you again for your support.