Designated Beneficiary

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DEFINITION of 'Designated Beneficiary'

The person who determines how long the retirement plan will survive as a tax-deferred vehicle under the laws governing certain retirement plans. The designated beneficiary must be a person, or in certain situations, a trust for designated individuals.

BREAKING DOWN 'Designated Beneficiary'

Since 2002, the laws governing the distribution of qualified retirement plan assets have become extremely complex. A designated beneficiary must be a person, not an estate and not a charity, although there are also other less tax-efficient ways of making distributions to entities.

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RELATED FAQS
  1. Can an IRA beneficiary roll the IRA over into another account and designate another ...

    It depends on the provision of the IRA plan document. Some (though very few) do not allow the designation of successor beneficiaries. ... Read Full Answer >>
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    You cannot put your IRA in a trust while you are living. You can, however, name a trust as the beneficiary of your IRA and ... Read Full Answer >>
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    Once a revocable trust is created, a trust maker transfers funds or property into the trust by including them in a list with ... Read Full Answer >>
  4. What is the difference between a revocable trust and a living trust?

    A revocable trust and living trust are separate terms that describe the same thing: a trust in which the terms can be changed ... Read Full Answer >>
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