IRA Beneficiary Trust

Reviewing an IRA beneficiary trustNaming a trust as the beneficiary of your retirement money used to be one of the worst things you could do.  There were only three or four circumstances where you would want to spend the money for this special trust.  Even when you did spend the money it was highly likely that your trust would not hold up to the IRS or creditors.

Since the U.S. Supreme Court ruling Cark et ux. v. Rameker, Trustee, et al., June 12, 2014 that has all changed. It is now time to fully understand why you would not want to name an IRA Beneficiary Trust as the beneficiary or your retirement money.  Talk about doing an about face or a 180 degree turn!

Here are some simple questions to ask**:

  • How much money is in your retirement accounts, is it enough that you want to protect it?
  • Are any of the beneficiaries minors?
  • Are any of the beneficiaries on public assistance?
  • In the future is it possible that a beneficiary will be on public assistance?
  • Do any of the beneficiaries have issues with money, maybe they are too good at spending money?
  • Are any of the beneficiaries married?
  • Have any of the beneficiaries had major health issues?

If you answered yes to any of these questions, you may need an IRA Beneficiary trust.  Done properly not much really changes for the beneficiary.

If even one step or item is missed on the checklist it is possible the IRA will have to be fully distributed in a five years or less.

We also invite you to consider having us create a Family Estate Organizer.  This one item is often the best thing you can do for those you leave behind.

As a member of Ed Slott’s Master Elite IRA group – we have extensive training in dealing with these trusts.  Read more here

**We are not providing legal advice.  YOU must always contact a licensed attorney who specializes in IRA beneficiary trusts.  These are highly specialized documents.  Don’t let buzzwords or service marks impress you.