death benefits

[mehmgo]

We have a deceased person whose assets are to be split between 5 beneficiaries at the investment house. The beneficiaries choose to leave the assets in the plan. These assets are all held in one plan with each person having their own account. When the deceased assets are switched to the beneficiaries accounts within the plan and staying in the plan, should the beneficiaries receive a 1099-r as a rollover coming into the plan for these amounts?

[My 2 cents]

We have a deceased person whose assets are to be split between 5 beneficiaries at the investment house. The beneficiaries choose to leave the assets in the plan. These assets are all held in one plan with each person having their own account. When the deceased assets are switched to the beneficiaries accounts within the plan and staying in the plan, should the beneficiaries receive a 1099-r as a rollover coming into the plan for these amounts?

I don't normally work on that sort of thing, but if the money never left the plan, how could there be a 1099-R?

Of course, anything that was reportable would necessitate treating the beneficiaries as separate individuals. Note that for purposes of 5500 reporting, the beneficiaries would count as 1, since their benefits are all derived from the deceased participant. However, if one of the 5 was covered by the plan as an employee as well as being one of the beneficiaries, that person would have to be counted twice (once on account of their own benefits and once as part of the 5-headed beneficiary).

[david rigby]

Documentation can be important, even for simple actions.
This transaction certainly appears to be a rollover (or five).

Maybe page 4 of the 1099R instructions, particularly the reference to "non-spouse designated beneficiary", is relevant to the original question?

https://www.irs.gov/pub/irs-pdf/i1099r.pdf

[QDROphile]

Simply allocating to separate accounts for beneficiaries is not a distribution. Without a distribution, there can be no rollover. Without an election there can be no rollover. I would also want to see plan terms that allowed a person who is not an employee or participant to roll over into the plan. I think you just have separate accounts that are waiting for something to happen. Check plan terms about distributions to beneficiaries.

[GMK]

If memory serves, ... you now have 5 separate accounts in the plan, one each for the benefit of each beneficiary. That would be 5 accounts, all in the name of the deceased participant, each one FBO a different beneficiary. And what QDROphile said.