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Almost this exact question was asked just a day ago. See: My two cents added: Does the plan allow incoming rollovers? Just because the IRS rollover chat says its okay doesn't mean the plan has to allow it. Kind of plan is it? defined benefit? 401(k)? That being said - almost all of the 401(k) plans I've worked on over the years would be fine with the rollover. The husband would elect a rollover death distribution via whatever the typical distribution process is. Money would be recoded from the wife's account to his, a 1099-R issued showing the non-taxable death rollover, and that would be it.

Dang you are good at puzzles. Bet you slay at pictionary.

It's kinda hard to follow but I think this gets to the heart of it. and is probably (?) what is happening. If you (Chris123) are saying that the 401k withholding is coming from partnership income that is really going to an S corp(s) then that is problematic. The confusion comes because you seem to be describing a scenario where withholding is in fact coming from S corp W-2s, but the pension person is describing something else. It might help if we knew your role in this.

You may find this to be helpful. It’s part of the definition of Uniform Normal Retirement Age from the definition section of the 401(a)(4) regs. 1.401(a)(4)-12. (4) Conversion of normal retirement age to normal retirement date. A group of employees does not fail to have a uniform normal retirement age merely because a defined benefit plan provides for the commencement of normal retirement benefits on different retirement dates for different employees if each employee's normal retirement date is determined on a reasonable basis with reference to an otherwise uniform normal retirement age and the difference between the normal retirement date and the uniform normal retirement age cannot exceed six months for any employee. Thus, for example, benefits under a plan do not fail to commence at a uniform normal retirement age of age 62 for purposes of § 1.401(a)(4)-3(b)(2)(i), merely because the plan's normal retirement date is defined as the last day of the plan yearnearest attainment of age 62.