Trustee of Plan Dies

[jkdoll2]

The trustee of a plan died. The plan is terminating. The mother of the trustee has taken over as trustee.

There was no beneficiary form on file. The distribution for the trustee will be made out to his estate.

The investment company is holding up the distributions because they want his mother and father to sign the forms since they are co-representatives on the estate. Does the investment company need both signatures or is just one of them o.k. to do the distributions? The distribuiton for the Trustee is not being made out to an individual - but to his estate.

[jkdoll2]

One other thing - they are holding up all distributions for the plan (all other participants distributions), not just the Trustee's distribution. Who does become legal to sign on the distribution forms?

[jpod]

Presumably the investment company wants assurance that the appropriate person(s) is(are) authorizing the distribution. Let's step back and ask the right questions. Under the plan documents:

1. Who authorizes the distribution? The plan administrator? If so, who is the plan administrator? If the plan administrator is the employer, what kind of entity is the employer? If the employer is a corporation, the corporation acts through its board of directors and officers.

2. Does the trustee authorize the distribution? If so, what does the trust instrument say about appointment of a new trustee? Who does that?

etc.

Just because the mom and dad may be the co-executors or co-administrators of the decedent's estate (and even that is no more than speculation on my part), their status as such may be totally irrelevant to the administration of the plan.

[K2retire]

The legal concept that an employer might be a separate entity from its owner, and a plan is definitely a separate entity from the business or the businss owner is a difficult one for many people to grasp. (especially as they are grieving) If your business owner was a sole proprietor, and the same individual that you mentioned as the trustee, then the individuals handling the estate are probably authorized to act on behalf of the business. That does not automatically give them authority to act on behalf of the plan. The attorney for the estate should be able to assist with these issues to the satisfaction of the investment company.