Who Should Be The Beneficiary Of Your IRA?

As of December 31, 2010, individuals hold nearly $17.5 trillion in IRAs and Qualified Plans.  These assets now account for 37% of all household financial assets.  Because of the way lifetime required minimum distributions are now calculated, retirement plans will frequently be the largest asset held at death.

With a properly drafted trust and a properly completed beneficiary designation form you can leave a $100,000 IRA to a 25 year old beneficiary that will provide the beneficiary with $400,000 of after tax income over his life expectancy with the all the benefits normally associated with leaving property to a beneficiary in trust.  Compare this with the $60,000 the beneficiary would receive if left to a trust that, because of either the way the trust was drafted or the way the beneficiary designation was made, does not qualify for look-through status.  Contact Ross Estate Planning to get a copy of our article The Six Biggest IRA Beneficiary Mistakes.

See also the chart :”ABOUT ASK BOB” from the The Big IRA Book

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