HR 4, the Pension Protection Act of 2006, allows people who inherit 401(k) accounts to make withdrawals over their lifetime, rather than requiring them to withdraw the money all at once. Thus, taxing of the 401(k) will occur in increments, rather than all at once. Under prior law, only spouses could make withdrawals over their lifetime. However, spouses still have some benefits over nonspouses under HR 4. Spouses can rollover the 401(k) into their own IRA, delaying withdrawals (and taxation) until age 70 1/2. Nonspouses must make withdrawals right away. See "Nonspouses' 401(k) Rights Rise Under New Pension Reform Law" by Paul Katzeff, Investor's Business Daily, Aug. 21, 2006.