Is a new spousal waiver necessary for second marriage?

Client maintains safe harbor 401k profit sharing plan.
Participant's first wife died. New Beneficiary designations were completed, naming his children as beneficiaries.
The participant also has IRA's, which has his children as named beneficiaries.

Participant recently remarried. Pre-nup agreements were prepared, agreeing that she does not have any rights to his retirement plan or IRA's.

Would the new wife automatically become beneficiary of his retirement plan upon being married 1 year, unless the participant obtains a spousal waiver?
Is a spouse the automatic beneficiary of his IRA's as well?

The husband would rather not broach this less-than-romantic topic with his new spouse if he doesn't have to! 😉 

Thanks

1 hour ago, Old Reliable said:

Would the new wife automatically become beneficiary of his retirement plan upon being married 1 year, unless the participant obtains a spousal waiver?

Yes, and it may not have to wait a year depending on the terms of the plan. 

Since this has already been the subject of the pre-nup, hasn't the subject been broached already? Perhaps he might want to wait to bring it up again until after Valentine's Day... 😁

IRS Reg specifically states that a pre-nup does not affect the selection of beneficiary.  I think it is: Reg. 1.401(a)-20, Q&A28.

Very likely, the plan already answers the original question.

About an employment-based retirement plan, a reader of the plan’s governing documents might discern whether the plan provides a surviving spouse 100% of a death benefit or, if the plan provides a qualified preretirement survivor annuity, whether the participant may limit the QPSA to a 50% QPSA.

If a surviving spouse’s benefit is only a 50% QPSA, a beneficiary designation might be effective for the other half of the death benefit.

A participant might want information to consider choices about whether and how to seek one’s spouse’s consent.

Post-nups are a thing, and should be a standard part of any family law attorney that prepares pre-nups. As would be updating beneficiary forms both before and after the marriage occurs. 

The soon-to-be spouse cannot waive a plan benefit they do not yet have rights to. They don't have rights under a qualified plan until they are actually married. The plan does not (cannot) look at any pre-nup. So once the spouse actually has rights under the plan - that's when they can sign a waiver of the benefit on an updated beneficiary designation. 

Who is the rightful beneficiary in a death benefit transfer when the surviving spouse was the beneficiary? 
 

Employee passes and surviving spouse is the rightful beneficiary as no waiver was signed. 
Employee account was in early stages of transfer. 
Surviving spouse passes away before funds were transferred or beneficiary selected. 
 

thank you. 

On 11/15/2024 at 2:12 PM, Calavera said:

The goal of a QDRO in a defined benefit plan is to provide an Alternate Payee (AP) a portion of participant's benefit for AP's life. In a case of a Shared Interest QDRO, an Alternate Payee is assigned a portion of participant's benefit over participant's life. To ensure that the Alternate Payee will actually be receiving some benefits until he/she dies, the Shared Interest QDRO is forcing a participant to elect a J&S benefit, so upon participant's death, the shared portion payable to AP will stop, and J&S portion will start. However, this requirement applies only, and I am using words from your QDRO, "to the extent of the calculated interest".

Here is a simple example: The total benefit is $1,000 per month under 50% J&S. Marital portion of this benefit is $600 per month. AP is assigned 50% of the marital portion under the shared interest QDRO. Essentially it means that you are "receiving" $600 and "sharing" it with your ex 50/50 (each receives $300). When you die, you stopped receiving $600 and there is nothing to share anymore. The 50% J&S provision kicks in where AP receives 50% of the total benefit of $600, i.e. AP continues to receive the same $300, she was receiving before you died. Furthermore, the remaining $400 are not part of the marital portion, and you should be able to elect any other beneficiary for this benefit. However, if your marital portion is 100% of your total benefits, I think there is nothing you can do to change it, unless you will be able to completely nullify the existent Shared Interest QDRO and create new Separate Interest QDRO.

Your pension department should split your total benefit to "marital" benefit and "non-marital" benefit in regard to your ex and treat these separately. The "marital" benefit will be subject to the QDRO, and "non-marital" benefit will be subject to your election.

 

On 11/22/2024 at 5:42 PM, ESOP Guy said:

I am not the biggest expert on pension plans but given what I know and am reading here is there someone higher up in the Pensions Department you can talk to?  It sound like it possible there is a misunderstanding at the level you are currently speaking to. 

Also, you mention it is important you live in NJ. 

Do you work for a government body?  That can make a big difference and can be an important fact for the experts around here to know.  Public pensions have very different rules than a private pension plan as a general rule. 

On 2/13/2025 at 9:01 AM, Peter Gulia said:

About an employment-based retirement plan, a reader of the plan’s governing documents might discern whether the plan provides a surviving spouse 100% of a death benefit or, if the plan provides a qualified preretirement survivor annuity, whether the participant may limit the QPSA to a 50% QPSA.

If a surviving spouse’s benefit is only a 50% QPSA, a beneficiary designation might be effective for the other half of the death benefit.

A participant might want information to consider choices about whether and how to seek one’s spouse’s consent.

Yes, I work for a Government body and I have contacted Pensions to see if I can name current wife to my share of the pension as ex is named for a certain percentage of the pension as well. In addition ex is named as joint and survivor benefit. I am trying to see if I can change that as her percentage of pension and ex living with significant other, full time job for years makes her financially comfortable. Where my current wife is not so financially well off and I think it is only right for her to receive the survivor benefit.

I would have to amend my QDRO and I was told that the ex would have to agree because she is named as the J&S. I do not think I understood what that meant at the time of my divorce which was a good 22 years ago or I would never had agreed to it then either. Any advise?