Portability Options for Inherited Assets from Employer Plans, Traditional IRAs and Roth IRAs

To Traditional IRA

To Roth IRA

Beneficiary

Own

Inherited

Beneficiary

Own

Inherited

Employer Plan

Spouse

Yes

Yes

Spouse

Yes

Yes

Nonspouse

No

Yes

Nonspouse

No

Yes

Qualified trust

No

Yes

Qualified trust

No

Yes

Nonperson

No

No

Nonperson

No

No

Roth 401(k) and Roth 403(b)/

457(b) Gov’t

Spouse

No

No

Spouse

Yes

Yes

Nonspouse

No

No

Nonspouse

No

Yes

Qualified trust

No

No

Qualified trust

No

Yes

Nonperson

No

No

Nonperson

No

No

Traditional IRA

Spouse

Yes

Yes

Spouse

Yes[1]

No

Nonspouse

No

Yes

Nonspouse

No

No

Qualified trust

No

Yes

Qualified trust

No

No

Nonperson

No

Yes

Nonperson

No

No

Roth IRA

Spouse

No

No

Spouse

Yes

Yes[2]

Nonspouse

No

No

Nonspouse

No

Yes

Qualified trust

No

No

Qualified trust

No

Yes

Nonperson

No

No

Nonperson

No

Yes

PAGE 2

To Employer Plan Account

To Roth 401(k) & Roth 403(b)/457(b) Gov’t

Beneficiary

Own

Inherited

Beneficiary

Own

Inherited

Employer Plan

Spouse

Yes[3]

Yes [4]

Spouse

Yes 1

Yes 2, [5]

Nonspouse

No

Yes 2

Nonspouse

No

No

Qualified trust

No

Yes 2

Qualified trust

No

No

Nonperson

No

Yes 2

Nonperson

No

No

Roth 401(k) and Roth 403(b)/

457(b) Gov’t

Spouse

No

No

Spouse

Yes 1

Yes

Nonspouse

No

No

Nonspouse

No

Yes

Qualified trust

No

No

Qualified trust

No

Yes

Nonperson

No

No

Nonperson

No

Yes

Traditional IRA

Spouse

Yes

No

Spouse

No

No

Nonspouse

No

No

Nonspouse

No

No

Qualified trust

No

No

Qualified trust

No

No

Nonperson

No

No

Nonperson

No

No

Roth IRA

Spouse

No

No

Spouse

No

No

Nonspouse

No

No

Nonspouse

No

No

Qualified trust

No

No

Qualified trust

No

No

Nonperson

No

No

Nonperson

No

No

Notes:                                                         

  • The categories of spouse, nonspouse, qualified trust, and nonperson, refers to the type of beneficiary
  • For this purpose, an employer plan includes: a qualified retirement plan (401(a) and 403(a) plans), as well as, 403(b) and governmental 457(b) plans
  • Reference to Traditional IRA includes SEP IRAs; and if any deposits have aged for at least two years, a SIMPLE IRA
  • A SIMPLE IRA can only receive assets from another SIMPLE IRA
  • Assets must be rollover eligible in order to be rolled over to the receiving retirement account. A RMD amount is not rollover eligible. After-tax amounts cannot be rolled over from an IRA to an employer plan
  • Except for a spouse, a rollover from an employer plan to an inherited traditional or inherited Roth IRAs must be a direct rollover not a 60-day rollover
  • Assets that are being moved from a decedent’s IRA to an Inherited IRA of a non spouse beneficiary must directly transferred trustee-to-trustee
  • Except for after-tax balances, movement from a non-Roth account to a Roth account is treated as a taxable distribution
  • A qualified trust is defined in Treasury Regulations Section 1.401(a)(9)-4, Q&A-5


[1] Treated as a Roth conversion (may be taxable). Spouse must first elect to treat the inherited traditional IRA as his or her own IRA( see Q&A for this is done)

[2] Verify that IRA agreement provides this option, and if not, the only option available to surviving spouse is to treat the Roth IRA as his or her own.

[3] Surviving spouse must be a participant in the receiving plan.

[4] Account must remain within the same employer’s plan that held the deceased participant’s assets.

[5] Plan must allow for an in-plan conversion.

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