Life and Death Planning for Retirement Benefits

Chapter 6: Leaving Retirement Benefits in Trust

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The trustee of the trust that is named as beneficiary must supply certain documentation to the plan administrator. Reg. § 1.401(a)(9)-4 , A-5(b)(4). In the case of a qualified plan, “plan administrator” is the statutory title of the person responsible for carrying out the plan provisions and complying with the minimum distribution rules; the employer must provide the name, address, and phone number of the plan administrator to all employees in the Summary Plan Description. In the case of an IRA, the IRA trustee, custodian, or issuer is the party to whom the documentation must be delivered. Reg. § 1.408-8 , A-1(b). A. Post-death distributions. The deadline for supplying the required documentation with respect to post-death distributions is October 31 of the year after the year of the participant’s death. Reg. § 1.401(a)(9)-4 , A-6(b). Although § 401(a)(9)(H) suspended required minimum distributions for the year 2009 (see ¶ 1.1.04 ), the suspension did NOT extend this deadline. Thus, the trustee of a trust named as beneficiary of a decedent who died in 2008 (or 2009) still had to supply the required documentation no later than October 31, 2009 (or 2010), even though the trust was not required to take any RMD in 2009. Notice 2009-82 , 2009-41 I.R.B. 491, Part V, A-4. Here is the documentation required to be supplied to the plan administrator by that deadline. The trustee of the trust must either: 1. “Provide the plan administrator with a final list of all beneficiaries of the trust (including contingent and remaindermen beneficiaries with a description of the conditions on their entitlement) as of September 30 of the calendar year following the calendar year of the employee’s death; certify that, to the best of the trustee’s knowledge, this list is correct and complete and that the [other “trust rules”] are satisfied; and agree to provide a copy of the trust instrument to the plan administrator upon demand ...”; or 2. “Provide the plan administrator with a copy of the actual trust document for the trust that is named as a beneficiary of the employee under the plan as of the employee’s date of death.” Supplying a copy of the trust (#2) is an easier way to comply than providing a summary of the trust (#1). However, some retirement plans may require the summary-certification method of compliance (#1), since it relieves the plan administrator of the burden of reading the trust and determining whether it complies with the trust rules. B. Lifetime distributions. The identity of the beneficiaries is irrelevant to the calculation of lifetime RMDs if the participant is using the Uniform Lifetime Table ( ¶ 1.3.01 ). Therefore, the participant has no need to comply with the documentation requirement or other trust rules for his lifetime distributions unless: (1) the participant has named a trust as his sole beneficiary; (2) the participant’s more-than-10-years-younger spouse is the sole beneficiary of the trust (see ¶ 1.6.06 ); and (3) the participant wants to use the spouses’ joint life expectancy (rather than the Uniform Lifetime Table) to measure his RMDs. In such cases, see Reg. § 1.401(a)(9)-4 , A-6(a), regarding the documentation to be supplied. No deadline is specified for supplying documentation in the case of lifetime RMDs. The conservative assumption would be that the deadline is the beginning of the distribution year in