What is a 40l k administrator’s liability for failing to informan employeeabout obtaining a waiver regarding designation tobeneficiaries other than a spouse?

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What is a 40l k administrator’s liability for failing to informan employeeabout obtaining a waiver regarding designation tobeneficiaries other than a spouse?

My mother past away 5 years ago. She divorced my father in 1986 and likely at that time changed her beneficiaries for her 401K to be split between my sister and I. She re-married in 1990 and legally changed her name. When she passed away in 2005, my sister and I were contacted by the 401K administrator about transferring funds to us. Then at the last minute they notified us that her husband had inquired and declined to sign a waiver. Would there be any culpability on the plan administrator’s part to inform her of the necessity of a waiver once she had re-married?

Asked on February 6, 2011 under Estate Planning, Texas

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

I am sorry for your troubles on top of your loss.  Get yourself an attorney as soon as you can.  And if it is not too late put the plan on notice that you are disputing their distribution to your step father and that you are making a claim for the funds and that you demand that the plan administrator interplead the funds in to court asap.  Your Mother had every opportunity to name her new husband as the beneficiary.  I would argue that she chose not to and to leave you and your sister as the beneficiaries.  Then check Texas law and see what it says.  But I would absolutely not take this lying down.  Good luck to you.


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