On Fri, 25 Aug 2006 19:25:14 -0500, efflandt[at]xnet.com (David Efflandt)
wrote:

- quote -

My understanding is that while the IRC allows non-spouse beneficiary
to roll the account to another custodian (it still operates as an
inherited IRA), IRC does not mandate this option and the current plan
document (in this case the 403b) controls. I may be out-of-date on
this though.

-HW "Skip" Weldon
Columbia, SC

Thanks David, I'll check that out.

David Efflandt wrote:
- quote -

On Fri, 25 Aug 2006, gdmoffitt[at]gmail.com <gdmoffitt[at]gmail.com> wrote:
- quote -

It can be transferred to another trustee (best done with direct trustee to
trustee transfer), but an inherited non-spouse IRA has to remain in the
name of the deceased. It is best to check with an expert for the exact
wording, but something like "Jane Doe deceased FBO Joe Dokes beneficiary".
I imagine it can be split it to 3 separate accounts for each FBO (for
benefit of). See http://www.irs.gov/publications/p590/ch01.html#d0e3082

New regulations just passed may offer more distribution options. Just do
NOT take a lump sum distribution, put it directly in your name, or
comingle it with your own money, or you may get a hefty tax bill in a
higher tax bracket.

My mother, who recently was the beneficiary of my deceased father's
403(b), recently passed away. The firm where the 403(b) was held
rolled that over to an IRA account for my mother.

As the estate executor for my mother, I've contacted the firm to start
the process of distribution of the funds. I did some preliminary
review of some IRA and tax books, and my understanding was that rolling
over the funds is only allowed for spouses.

The firm holding the IRA has told me that we may want to consider
holding the funds at thier firm pending possible legislation that would
allow non-spousal beneficiaries to roll the funds into their own IRA's.

I googled around and found some references to this issue, but it seems
like this proposal has been around for some time, so given the
efficiency of our legislative and regulatory system, I'm leery that
this will happen any time soon. The amount of money is under six
figures, and would need to be divided among three people, so involving
a tax attorney does not seem like a good idea.

Does anyone have any current knowledge of the status of this proposed
change and what realistic chance it has to pass, and even if it does,
would it apply to the IRA of someone who died this year?

Thanks