What to do when a Ascensus account holder dies

For ERISA-covered qualified plans (such as 401(k) and defined benefit plans), federal law requires spousal consent if you name someone other than your spouse as primary beneficiary. Your spouse is entitled to at least 50% of death benefits under ERISA unless they provide written consent to waive this right, documented on Form 482-R (QP Distribution Notice subject to REA). IRAs and non-ERISA plans generally do not require spousal consent, though state community property laws may apply.

For deaths on or after January 1, 2020: use Form 341 (IRA Beneficiary Required Election) and Form 344-IH (Inherited IRA Payment Election). For deaths prior to January 1, 2020: use Form 321 and Form 324-IH. You will also need a certified death certificate, government-issued ID, and Form 317 (IRA Withholding Notice and Election). If the beneficiary is a trust, include trust documentation. Use Form 301-SU (IRA Beneficiary Designation Addendum) if additional beneficiary pages are needed.

Under SECURE Act 2.0 rules, most non-spouse designated beneficiaries must fully distribute inherited retirement account assets within 10 years of the account owner's death (for deaths on or after January 1, 2020). Eligible designated beneficiaries -- surviving spouses, minor children of the deceased, disabled individuals, chronically ill individuals, and beneficiaries not more than 10 years younger than the deceased -- may have additional options including life expectancy distributions. Ascensus's IRAdirect platform includes compliance logic to validate beneficiary classifications under these rules.

A 529 education savings account does not pass through a will or beneficiary designation the way a retirement account does. The account owner (not the student-beneficiary) controls the account, and most Ascensus-administered state 529 plans let the owner name a successor account owner. On the owner's death, the successor owner assumes full control -- including the right to change the student-beneficiary or request a refund -- without the account passing through probate. If no successor owner is named, control passes to the deceased owner's estate. To name or update a successor owner, log in to the plan's portal or contact 529 support at 877-529-2980; the exact form varies by state plan.