Segregated account for AP, then distribution

[Guest dbvail]

We have a QDRO that directs the amount to be put in a separate account established under the plan, with language directing that distribution options then be provided to the AP. The plan does allow for payment to AP as a triggering event, but the Participant is over 50 anyway.

Can the AP subsequently rollover the segregated account to an IRA?

[mbozek]

If the APs interest is held in a segregated account then the benefits will be payable under any form available to any othe benes (unless otherwise restricted by the QDRO). If a LS option is available to a bene, the AP could roll the distribution to an IRA.

[JanetM]

mbozek, doesn't the AP have to be spouse or ex-spouse to do rollover?

[Guest dbvail]

I assume mbozek was presuming the spousal conection. It is a good assumption in this case. The question was asked as the AP had been told that unless the payment were made directly from participant's account (versus from a segregated account), it would not be eligible for rollover. These darn advisors! I just wanted to check in and see if something new was happening. Thanks for the responses.

[mbozek]

IRC 402(e)(1)(B) provides that a spousal AP can rollover any portion of the retirement benefit received under a QDRO regardless of whether it is a separate account or shared interest.