Who Qualifies For Retirement Plan Rollovers?
The question of who qualifies for retirement plan rollovers is an important one. Note that there are eligibility requirements you must meet to move forward with this type of transaction. Find out more about these criteria below.
The following taxpayers can qualify to roll over retirement plan distributions:
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The retirement plan participant,
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Spouse of a deceased plan participant,
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Non-spouse beneficiary (must be a direct trustee-to-trustee transfer from the deceased employee’s qualified plan, 403(b) plan or Sec 457 plan to an IRA), and
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An alternate payee spouse under a “qualified domestic relations order.”
Surviving Spouse Could Not Roll Over Her Community Property Interest in IRA - In a situation where a deceased husband’s IRA named the husband’s son as sole beneficiary but the state court had assigned half of the IRA to the surviving spouse as community property, the surviving spouse was unable to roll over her portion of the IRA because she was not the named beneficiary. In a private letter ruling the IRS concluded that since community property interests must be disregarded under Code Sec. 408(g), she couldn't be treated as a payee of the inherited IRA for her son and therefore distribution rules must be applied without regard to community property laws, making the entire distribution taxable to the son. (Private Letter Ruling 201623001)