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In-service death benefit


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A government DB pension plan pays an in-service death benefit equal to 3 times annual salary. The beneficiary has been told that the amount is taxable. Is it, therefore, eligible to be rollover to an IRA?

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Yes, it can be rolled over to an inherited IRA. However, this will not eliminate required minimum distribution requirements, so the beneficiary (if not a spouse) will need either to start taking distributions within one year or to take a complete distribution from the IRA within 5 years.

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

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