Nonspouse beneficiary of qualified plan and IRA rollover

[Guest P Williamson]

A participant in a qualified plan died in 2004. The beneficiary is a nonspouse. The plan states that all beneficiaries must receive their balance within 5 years. The beneficiary elected to defer receiving the balance as long as possible and has not yet taken any distributions. May the beneficiary roll the balance over to an "Inherited IRA" in 2007? Or, since she has not taken the RMD in 2005 and 2006, is she ineligible for the rollover?

[Guest mjb]

IRS is expected to issue regs on non spouse transfers to IRA by end of the year.