Eligible Designated Beneficiary? – Disabled in wheelchair since young age, but has a job?
I’m wondering if a man, late 30s, disabled since a young age, has been and will be in a wheelchair for his life, cannot drive, was on disability social security his whole life until recently he got a job with 60k salary working from home– would be considered an eligible designated beneficiary as a son of the deceased IRA owner, therefore not have to adhere to the 10 year rule?
I believe the definition from the IRS is:
“A person is permanently and totally disabled if both of the following apply. They can’t engage in any substantial gainful activity because of a physical or mental condition. A physician determines that the disability has lasted or can be expected to last continuously for at least a year or can lead to death.”
He is permanently disabled and it will last continuously but since he just now got a job, will he not be considered an eligible designated beneficiary?
Please share your thoughts, thanks!
Permalink Submitted by Alan - IRA critic on Wed, 2024-02-21 15:46
What were the dates he lost SSD and the date of parent’s death? If he was an EDB as of the date of death he will remain an EDB even if he loses SSD benefits later on. The beneficiary must provide documentation to the plan administrator of disability status no later than 10/31 of the year following the year of death.
Permalink Submitted by LPL Advisor on Wed, 2024-02-21 16:20
He lost SSD before the date of the grandfather’s death (not the father I just learned). His grandfather died in the end of 2021, and he started working before that. So does that mean he definitely wasn’t an EDB at the time of his grandfather’s death? Just because he had a job? And it would definitely be too late to provide documentation of disability since it was a few years ago?