Can a retirement plan refuse a rollover? If a tenant wants to buy; Leaving your spouse less than the law allows; Insure a classic car for its full value
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Q:I've read that an IRA can be rolled over to a retirement plan, but the administrator at my new place of employment says a plan can refuse such rollovers. Is he right?
A: Yes. Or the plan can accept them subject to conditionsfor example, certification that the IRA funds are eligible for transfer. You aren't allowed to roll over required minimum distributions, after-tax contributions, or payments you receive as beneficiary of an inherited IRA.
Q: A prospective tenant for a rental residence I own tells me he might be interested in buying it, if he and his live-in companion get married. What kind of arrangement would be fair to both of us?
A: If you want to encourage a purchase, agree in writing on a price the two of you are comfortable with and give the tenant a reasonable timesix months to a year, say to make up his mind. If he's serious, he should be willing to pay you for a commitment, either in cash up front or in the form of a higher monthly rent than the amount you'd accept on a straight lease. To keep things simple, the option and the lease should be for the same period.
Q: The law in my state gives my husband the right to claim one-third of my estate if my will leaves him a smaller share. Can I get around this rule by putting my assets into a revocable living trust?
A: Only if your husband's right is limited by law to a fraction of your probate estatethe property disposed of in your will. In about half the states, your spouse would be entitled to a "forced share" of nonprobate assets as well. They could include property you hold in a trust or jointly with persons other than him. Even lifetime gifts might not escape your husband's grasp, if you die within two or three years after making them.
Q: I have my heart set on acquiring a classic car, even though I'll have to pay much more for it than the original sale price. What's the best way to make certain I'd be reimbursed for a total loss due to an accident?
A: Your regular carrier would probably insure it for the value you state, but an insurer specializing in classic or collectible vehicles is likely to give you better coverage at a considerably lower premium. With a "stated value" or "stated amount" policy, an insurer might reimburse you for a lesser figure, if the claims adjuster determines that's what the car was worth when the loss occurred. A specialty policy guarantees that you'll receive the "agreed amount"the car's fair market value decided between you and the agent at the time the policy was issued or renewed.
Many specialty policies restrict your driving to 2,500 miles a year and require you to have another separately insured vehicle for ordinary use. That limitation may enable the company to charge a fraction of the premium you'd pay a regular carrier on a car of similar value. For a list of insurers that cover classic or collectible cars, see "The Ins and Outs of Collector Car Insurance," at www.edmunds.com under the "Insurance" link on the home page.
Do you have a money management question that may be stumping other doctors, too? Write: MMQA Editor, Medical Economics, 5 Paragon Drive, Montvale, NJ 07645-1742, or send an e-mail to firstname.lastname@example.org (please include your regular postal address). Sorry, but we're not able to answer readers individually.
Lawrence Farber. Money Management Q&As. Medical Economics Apr. 25, 2003;80:95.