I can't find my spouse!  Believe it or not, benefit plan administrators hear that statement on a regular basis.  Plans with qualified joint and survivor annuity options ("QJSAs") can be faced with a dilemma when a participant is seeking a distribution in a form other than as a QJSA without spousal consent and the participant also asserts they cannot get that consent because their spouse has "disappeared."  If the spouse refuses to consent, then there is no distribution.  But what if they really have no idea where their spouse is?

From an administrators perspective, how they disappeared is not as important as confirming that they have actually disappeared.  Or, to put it more correctly, that the spouse cannot be located to give or deny consent.  It is one thing when a participant can't find their spouse, but a plan cannot simply accept that the spouse is gone.  Such was the case in Lester v. Reagan Equipment, where the participant gave the plan administrator an affidavit listing all the ways he tried to find his missing spouse.  The plan accepted the affidavit and distributed the plan account balance without tying it up in a QJSA.  Sure enough, the "missing" spouse popped up demanding her benefit after the participant died.  The court found that relying on the affidavit was not enough.  The administrator had to "take reasonable steps on its won to verify that the spouse could not be located."

So what are reasonable steps?  Section 205(c) or ERISA and Code Section 417(a)(2)(B) provide that a plan can make a distribution without a QJSA if it is established to the satisfaction of a plan representative that the consent required may not be obtained because there is no spouse or because the spouse cannot be located.  But what constitutes proof?  There are locator services through the IRS Letter Forwarding program and Social Security that a plan administrator should use as proof they tried.  An certifications from participants certainly help.  But the Code and ERISA are delightfully silent on other options.

Well, consider what the federal government does.  Under 5 CFR 846.202, the Federal Employees Retirement System provides that the Office of Personnel Management may waive the requirement of spousal consent upon a showing that the former spouse's whereabouts cannot be determined.  A request for waiver on this basis must be accompanied by—

  1. A judicial or administrative determination that the former spouse's whereabouts cannot be determined; or
  2. Affidavits by the employee or Member and two other persons, at least one of whom is not related to the employee or Member, attesting to the inability to locate the former spouse and stating the efforts made to locate the spouse; and Documentary corroboration such as newspaper reports about the former spouse's disappearance.

It also provides that OPM may waive the requirement of consent  based on "exceptional circumstances" if the employee or Member presents a judicial determination regarding the former spouse that would warrant waiver of the consent requirement based on exceptional circumstances.

Unfortunately most plan administrators are not prepared to deal with a missing spouse and did not draft rules or procedures to address this issue.  Maybe it will never happen to your plan.  But consider the possibility that it might and be prepared in advance if it does.  By providing a framework in the SPD on which a decision will be made, you put participants on notice of how they will need to comply.  It is not enough to just take their word for it.