Par. 6. Section 1.401(a)(9)-8, as revised in a final rule published elsewhere in this issue of the Federal Register , effective September 17, 2024, is amended by: a. Revising the second sentence of paragraph (a)(1)(iii)(B); b. Revising the first sentence of paragraph (a)(1)(iii)(C); and c. Adding paragraph (a)(1)(iii)(D). The revisions and addition read as follows:
(a) * * *
(1) * * *
(iii) * * *
(B) * * * Except as provided in paragraph (a)(1)(iii)(D) of this section, the preceding sentence applies only if the separate interests are held by separate see-through trusts (in which case the rules of §§ 1.401(a)(9)-4(f) and 1.401(a)(9)-5 will apply separately to each separate trust).
(C) * * * For purposes of paragraph (a)(1)(iii)(B) of this section, a trust is immediately divided upon the death of the employee only if, as of the date of death, the trust is terminated and there is no discretion as to the extent to which the separate trusts (or the beneficiaries described in paragraph (a)(1)(iii)(D) of this section) will be entitled to receive post-death distributions attributable to the employee's interest in the plan. * * *
(D) Outright distribution to trust beneficiary. The separate interests of the beneficiaries in a see-through trust will not fail to be eligible for the exception under paragraph (a)(1)(iii)(B) of this section merely because, upon termination of the trust, a beneficiary's separate interest in the trust is to be held directly by that beneficiary rather than being held by a separate see-through trust.
* * * * *