Money Purchase Plan Distribution

[52626]

Employer has a  Money Purchase Plan.  Participant named her children as her primary beneficiary and the spouse consented to waiving his rights.

The employee has now terminated and wants to take a distribution.  Does the participant's spouse have to consent to the payment?  Since he waived his rights when he signed the beneficiary form, does he still have to consent to the distribution?  I am thinking the beneficiary waiver does not  apply when a distribution is requested.

Thoughts

Thanks

[jpod]

I am thinking that you are correct.  The spousal waiver of the mandatory J&S form of benefit can only be made within a limited number of days prior to the annuity starting date. 

[52626]

I assume you mean the 180 day waiver period?

 

[jpod]

To be honest I don't remember what the length of time is these days but I think we are on the same page.  

[JackS]

I don't think waiving your right to be a beneficiary has anything to do with spousal consent to a distribution.  I think the spouse needs to consent to the distribution, unless the employee is deceased.

 

[Luke Bailey]

Clearly, there is nothing in the law that would treat the beneficiary designation waiver as a waiver of the J&S when distributions actually commence to the participant. Two completely separate requirements.

[CJ Allen]

I agree with Luke & JackS.  The waiver of a death benefit to go to the children is separate from a distribution election.  In a distribution situation, the beneficiary form to identify a Designated Beneficiary upon the employee's death is of no consequence.

The distribution election not only involves funds potentially not going to the beneficiaries, it creates a single sum distribution option that could affect the spouse and the named heirs negatively.