Distributions

[Guest Kevin1]

Owner-participant retires from the practice. He leaves his monies in the plan. He dies (younger than 70 1/2). Spouse is a non participant and is the designated beneficiary. Document says immediate payout to the beneficiary on participant's death. Paperwork was sent to surviving spouse and she chooses not to deal with it.

Since she is a non participant, she can not rollover the monies internally. Since the benefit is over $300K I don't think a forced distribution is applicable. Any suggestions?

[ETA Consulting LLC]

Document says immediate payout to the beneficiary on participant's death.

I would recommend revisiting the language in the document. You "may" be correct, but the death distribution rules under IRC 401(a)(9) would not require the spouse to begin receiving a distribution until the year the decedent would have turned age 70 1/2. A play "may" require immediate payment, but plans are "typically" consistent with delaying until a distribuiton is required by law (in cases when the spouse is beneficiary). I would verify this with your plan. Again, you may be correct, but I am merely suggesting to reverify this.

Good Luck!