Over the past month, Brett and I have been updating wills, legal papers and moving some retirement monies. We are painfully aware of this country’s discriminatory laws concerning estates and retirement plans inherited by GLBT partners.
Today, I received a good news from HRC. The Pension Protection Act was signed into law and it includes two provisions that extend important financial protections to more Americans including same-sex couples.
- The first provision, called “Non-Spousal Rollover”, allows the transfer of an individual’s retirement plan benefits, like a 401(k), to an Individual Retirement Account (IRA) for a non-spouse beneficiary like a domestic partner, sibling, parent, cousin or anyone else when the individual dies. In the past, unless you were the legally recognized spouse of the deceased, you were forced to withdraw the amount as a lump sum and you faced immediate tax penalties which would eat away at the savings amount intended for retirement.
- The second provision, known as “Hardship Distribution”, allows individuals who list their same-sex partner or other non-spouse beneficiary under a 401(k) plan the ability to tap into their retirement funds in the case of certain medical or financial emergencies of the beneficiary. In the past, the federal law only permitted such withdrawals for employees’ legally recognized spouses or dependents.
In these times and under this country’s leadership, this is quite a victory for all Americans. I guess it shows that there is some light at the end of the tunnel.