trust is beneficiary

[Scuba 401]

the designated beneficiary is the beneficiary of the trust. i know the rule is that the account must be paid out over the life expectancy of the oldest designated beneficiary. however i am not sure about the mechanics of this. does the account get rolled over to an IRA in the name of the beneficiary or does it stay in the name of the trust? has anyone actually done this?

[masteff]

Does the account HAVE to be rolled over? No. Can it be rolled over? Maybe, see Q&A-16 in notice 2007-7 http://www.irs.gov/pub/irs-drop/n-07-07.pdf

[Appleby]

Please be careful about the terminology that you use. Using the wrong terminology often result in mistakes that cannot be corrected. A nonspouse beneficiary cannot rollover distributions (except as a direct rollover from a qualified plan, 403(b), 457(b) to an Inherited IRA as a direct rollover). A nonspouse beneficiary can move assets from the decedents’ IRA to an Inherited IRA as a transfer.

Also, the life expectancy of the beneficiary is used only if the trust is a qualified trust