Estate Planning

FAQs About Estate Planning

Can I Name Someone Other Than My Spouse As Beneficiary Of My 401(k)?

by Rania Combs

A concerned relative contacted me. Her cousin had been married for eight years before her recent death. Her deceased cousin had a son from a prior marriage.

Her cousin started a 401(k) plan three decades before her marriage and she wondered whether her cousin’s son would be entitled to any portion of the 401(k).

A 401(k) plan is a “qualified” retirement plan created for employees that must meet specific IRS rules in order to qualify for federal tax benefits.

Qualified retirement plans are governed by federal law which requires that a surviving spouse inherit all the money in the account unless the spouse has signed a waiver during the marriage authorizing that a different beneficiary be named.

This is the case even if a prenuptial agreement has been signed. Additionally, just because a spouse signs a waiver at some point in the marriage doesn’t prevent the spouse from withdrawing consent at a later point in time.

About Rania

Rania graduated magna cum laude from South Texas College of Law Houston and is the founder of Rania Combs Law, PLLC. She has been licensed to practice law since 1994 and enjoys helping clients in Texas and North Carolina create estate plans that give them peace of mind.

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