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Require Letter of Testamentary for Distribution on Death?


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We have a situation where a participant in a plan has died.  His brother has provided a POA naming him.  He doesn't have any letters of testamentary because he's saying he doesn't need one - he's the POA.  Our process is to require a letter of testamentary to show who was appointed the executor.  Are we ok distributing to the estate without a letter of testamentary - just distribute to the estate - paid to the estate, etc.  I think we still need one - we need something to show that this person has the authority to sign on behalf of the estate.  Any help would be appreciated.

 

Thank you,

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Most plans have a default definition of beneficiary if the participant has not made an election.  That's what counts.

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I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

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POAs are invalid post death.  They only allow the holder to do that which the grantor of the power could do.  I would suggest the grantor can't request a distribution post death - so neither can the POA holder.

As David said, check the plan for what happens upon death - and see if there is a default beneficiary.

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