Does a 'Designated Beneficiary' have to be designated in the plan?

okay maybe it's a silly question.  Terminated participant receiving RMD's passed away with no surviving spouse.  His daughter is handling his affairs but was never specifically set up as a beneficiary.  Can she be treated as a Designated Beneficiary?

fwiw, the account balance is under $1,000.

The plan document should specify the beneficiary if there is no designated beneficiary. The plan document must be followed.

So, no to your question.
 

If the plan provides that, in the absence of a designated beneficiary, the eldest child of the participant is the beneficiary, and said daughter is the only child of the participant, then the daughter is the beneficiary, but not a designated beneficiary.

I doubt that the plan provides that the eldest child of the participant as the default beneficiary. The plan might provide that the children of the participant are beneficiaries, and equal shares.

The plan might provide that the estate of the participant is the beneficiary. If the daughter is the administrator of the estate, then the daughter will manage the plan benefit.

Consider that who is a beneficiary to get a distribution and who is a designated beneficiary as § 401(a)(9) rules use that specially defined term to drive how minimum-distribution rules apply can be distinct concepts.

For an account balance less than $1,000 and given the circumstances TPApril describes, one suspects the plan’s administrator won’t worry about measuring a minimum distribution.

If the default beneficiary, after exhausting those with a higher priority, is the participant’s estate, some claimants say it might be a pain-in-the-assets to open an estate administration (or reopen a closed administration) if otherwise that would not be done.

Some plans’ administrators might interpret that paying according to a small-estate affidavit made according to the relevant State’s law (when the administrator lacks knowledge that the affidavit is false), is a satisfaction of the plan’s obligation to pay the participant’s estate as the last-stop default beneficiary.

I’m not saying that’s my view, only that I’m aware others use it.

Or a plan’s administrator might deny a claim of a claimant who does not deliver satisfactory evidence that she is the duly appointed executor, administrator, or other personal representative of the participant’s estate.

Again, I don’t say whether that’s right or wrong.

This is not advice to anyone.

Building on what Peter has said, given the small amount in the account, if the estate is the dfault beneficiary, many states have a procedure where estates with a very low dollar amount can have an administrator file an affidavit with the probate dept and avoid probate entirely. The dollar amount differs from one state to the next.  

And here are some earlier BenefitsLink conversations:

https://benefitslink.com/boards/topic/63408-does-a-plan-pay-on-a-small-estate-affidavit/

https://benefitslink.com/boards/topic/70685-california-small-estate-affidavit/

https://benefitslink.com/boards/topic/72981-death-benefit-missouri/.

Going back to the original question, the daughter could be a designated beneficiary if she is the beneficiary due to a default in the plan document. If the default is the estate then she is not a designated beneficiary, even if she is the sole heir. If the default is to the kids and then she is a designated beneficiary. And so would any of her siblings. The regulations only require that the beneficiary be identifiable by the plan - and be an individual or determinable through a look-through trust. There is no look-through rule for an estate.