Most people name their spouses to inherit the funds in their retirement plan accounts after they die. But even if the spouse wasn't named as the beneficiary, that spouse may still have the right to claim some of the funds.
The surviving spouse (or registered domestic partner) is not automatically entitled to inherit the money in the deceased spouse's traditional IRA or Roth IRA. If the account owner designated someone else as the beneficiary, then that person will be able to claim the money. There are certain limitations on this right, however.
If the couple lived in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin), then the money in a retirement account may be community property. Community property is owned by the couple equally.
An IRA is an individual account, but if the contributions came from community property—for example, one spouse's wages after the couple got married—all the money in the account is community property unless the couple expressly agreed otherwise.
If the account is community property, then the surviving owns half of it and is entitled to claim their half. It's not an inheritance—the spouse always owned half of the money.
In other states, a surviving spouse is always guaranteed something from the deceased spouse's estate. No married person can totally disinherit a spouse unless that spouse gives up, in writing, any rights to inherit.
Surviving spouses who aren't satisfied with what they inherit can go to court and claim whatever share of the deceased spouse's property that state law gives them. How much the survivor is entitled to claim varies widely from state to state, and in some places depends on how long the couple had been married. Often, the "spousal share" (the amount the surviving spouse is entitled to) is one-third or one-half of the property. The law may take IRA funds into account when determining how much the survivor can claim.
"Qualified" retirement plans are plans that are set up for employees and meet certain IRS rules in order to qualify for federal tax benefits. The most common examples are 401(k) and 403(b) plans, which employees fund with deferred salary.
These plans give the surviving spouse the right to inherit all money in the account unless the survivor signed a waiver giving up rights and allowing the other spouse to name a different beneficiary. The institution that administers the qualified plan can provide a waiver form.
The survivor must have signed the waiver while the couple was married. So if the couple signed a prenuptial agreement before they married, and one or both of them gave up rights to the other's qualified retirement plan account, it won't serve as a valid waiver.