If a named 401k beneficiary rejects the distribution on the death of t

[Guest David O'Loughlin]

If a named 401k beneficiary rejects the distribution on the death of the participant, what options are available to the administrator?

[david rigby]

What do you mean by "reject"?

Note that in many plans, if the value of a benefit due is less than $5000, the plan will automatically make the distribution.

[Guest David O'Loughlin]

The beneficiary (who is the spouse)does not want the money (I assume for estate tax reasons).

[KIP KRAUS]

Dave:

Ask the beneficiary if He/she would like to assign me as beneficiary. I'll take it.

[david rigby]

No tax rate is as high as 100%. Can't imagine why the beneficiary would not want it. BTW, tax on a distribution from a qualified plan is deferred if rolled over into an IRA. Typically, a distribution to surviving spouse is made to the spouse, not to the estate of the deceased.

Beneficiary might consider delaying receipt, if that helps make a tax situation any better.