Question

1.) If the owner of a Keogh plan dies, what happens to the funds in the Keogh?

Answer 1

Ans-Each distribution is taxed as ordinary income. In the event that the contributor dies before reaching age 59.5 the contributor's heirs will receive the money that is in the Keogh plan, (minus income taxes). In this case no penalty taxes are imposed for early withdrawal.A Keogh owner’s surviving spouse can transfer the assets into an IRA in his or her own name. But non-spouse beneficiaries can only do a rollover to an IRA if the plan documents have been amended to allow it — and even then, they can do only a rollover to an inherited IRA.