The pension protection act of 2006 now allows non-spouse beneficiaries to roll over assets inherited from a qualified retirement plan into an IRA. What are the estate tax implication if this IRA is rolled over to a non-spousal beneficiary?
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None. The value of the IRA is included in the decedent's estate regardless of who the beneficiary is.
No different than before, really. Prior to this, a 401(k) could be inherited, but not not rolled into an IRA if beneficiary was a non-spouse. This is separate from the estate tax which would be paid by the decedent's estate if over a certain amount. Any retirement funds (except Roth IRA) are part of that estate. JOE
to estate tax like any other asset included in the taxable estate. If you want the roll over to be effective, you need to provide another source for the payment of estate tax attributable to the qualified plan.
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