Remote Witnesses for Spousal Consents

Prior to the COVID-19 pandemic, married participants were required to provide a spouse’s consent for certain retirement plan distributions. For example, if a participant preferred a lump sum distribution rather than the joint and survivor benefit, a legally executed and notarized consent was required before the benefit plan could distribute the lump sum. The requirement was meant to protect the spouse’s rights and interests, even though it might cause a minor inconvenience to some participants and beneficiaries.

During the COVID-19 pandemic, the Internal Revenue Service recognized the need to relax the requirement that spousal consent must be witnessed in the physical presence of a notary or plan representative. Accordingly, remote witnessing was allowed under limited circumstances and the IRS now seeks to make those allowances permanent with its proposed regulations regarding the use of electronic media for spousal consents. Should the proposed regulations become a final rule, in addition to spousal consents witnessed in the physical presence of a notary, a retirement plan may also accept remote notarization provided it takes place via live audio-video technology that is consistent with State law and participant elections.

Remote witnessing by a plan representative would also be allowed as long as the plan representative witnesses the signing by audio-video technology allowing for direct interaction between the spouse and the plan representative, the spouse presents a valid photo ID during the audio-video conference, the signed document is electronically sent to the plan representative on the same day so that the plan representative may acknowledge the signed document and return it to the spouse and a recording of the audio-video conference must be retained by the plan.