Naming a trust as a beneficiary is permitted by the plan. However, the individuals who are beneficiaries of the trust are treated as designated beneficiaries provided the trust meets the following requirements:
- The Trust is valid under state law or would be valid but for the fact that there is no trust corpus;
- The Trust is irrevocable, or it will, by its terms, become irrevocable on the participant's death;
- The beneficiaries are identifiable under the trust instrument; and
- A copy of the trust instrument or a certified list of beneficiaries is provided to the plan administrator.
It would be recommended that this participant/sponsor consult with an estate attorney before naming a living trust as her 401k beneficiary.