My spouse is the primary beneficiary of my IRA. I also have a contingent beneficiary. Can my spouse still transfer my IRA assets tax-free to her own IRA?
A spouse who is the sole primary beneficiary of an IRA can always treat the IRA as his or her own. The contingent beneficiary on an IRA is never taken into consideration unless the primary beneficiary predeceases the IRA owner, or the primary beneficiary disclaims the assets.
If the spouse is not the sole primary beneficiary, he or she can transfer the assets to an inherited/beneficiary IRA and later roll over the amount to his or her own IRA.
For more information, read Who Is The Beneficiary Of Your Account?, Problematic Beneficiary Designations - Part 1 and Disclaiming Inherited Plan Assets.
This question was answered by Denise Appleby