Christine Benz: "Who Should Inherit Your IRA?"

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gkaplan
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Christine Benz: "Who Should Inherit Your IRA?"

Post by gkaplan » Mon Sep 11, 2017 9:48 pm

Deciding who you want to inherit your IRA is straightforward. As with any other asset, the best answer is whoever (or whatever, in the case of charities) is most deserving and would derive the biggest benefit from the money.

Yet the logistics leaving IRA assets to loved ones, a trust, estate, or charity can get complicated; Morningstar.com contributor Natalie Choate, an IRA specialist, frequently writes about the mistakes people make when it comes to making IRA beneficiary designations.

Thus, before making plans for what will happen to your IRA when you're gone, be sure to understand the tax and other implications. Also double-check that your IRA beneficiary designations are in sync with any other estate-planning documents--trusts and wills--that you have drafted. Many people are surprised to learn that what's specified in the beneficiary designation will take precedence over what's specified in the other documents.

Here's what you need to know before leaving IRA assets to your spouse, other loved one, charity, estate, or trust. . . ."

Who Should Inherit Your IRA?
Gordon

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badbreath
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Re: Christine Benz: "Who Should Inherit Your IRA?"

Post by badbreath » Mon Sep 11, 2017 10:35 pm

Finally, it's worth noting that the future of the "stretch IRA" is in question, given that so few individuals take advantage of it.
Is this true? The stretch is what I am doing with my Inherited IRA and is working well, up 25K even after taking the RMD's.
“While money can’t buy happiness, it certainly lets you choose your own form of misery.” Groucho Marx

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FIREchief
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Re: Christine Benz: "Who Should Inherit Your IRA?"

Post by FIREchief » Mon Sep 11, 2017 11:18 pm

badbreath wrote:
Mon Sep 11, 2017 10:35 pm
Finally, it's worth noting that the future of the "stretch IRA" is in question, given that so few individuals take advantage of it.
Is this true? The stretch is what I am doing with my Inherited IRA and is working well, up 25K even after taking the RMD's.
The stretch is not in question because "so few individuals take advantage of it." It is in question because the Fed wants to obtain more tax revenue sooner. If you are currently the beneficiary of an inherited IRA, most of us would assume that your stretch would be "grandfathered" in any changes to the tax laws.

This article is comprised of very basic information, and really doesn't provide much useful information.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

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Peter Foley
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Re: Christine Benz: "Who Should Inherit Your IRA?"

Post by Peter Foley » Mon Sep 11, 2017 11:28 pm

Good article, although I agree not a lot of depth.

A key takeaway for many should be the advice about leaving an IRA to one's child or children. If they are adult children they should have an understanding of what their options would be if they inherit, and the consequences of those options. I've had those conversations with my two daughters.

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badbreath
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Re: Christine Benz: "Who Should Inherit Your IRA?"

Post by badbreath » Mon Sep 11, 2017 11:47 pm

this I agree with but still this should not be done
the Fed wants to obtain more tax revenue sooner
Similar to the conversation of moving all contributions from 401ks to Roth IRAs

http://tonyisola.com/2017/04/congresss- ... t-savings/
“While money can’t buy happiness, it certainly lets you choose your own form of misery.” Groucho Marx

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Re: Christine Benz: "Who Should Inherit Your IRA?"

Post by 2015 » Tue Sep 12, 2017 1:10 pm

Peter Foley wrote:
Mon Sep 11, 2017 11:28 pm
Good article, although I agree not a lot of depth.

A key takeaway for many should be the advice about leaving an IRA to one's child or children. If they are adult children they should have an understanding of what their options would be if they inherit, and the consequences of those options. I've had those conversations with my two daughters.
Another key takeaway is to ensure that all of your estate documents are in sync. I went through a rather excruciating estate planning process early last year, to include the compilation of an extensive "death book" (using the downloaded excel version from this site: http://www.erikdewey.com/bigbook.htm). My intention was to make settling my estate as easy as possible for my executor. Ensuring beneficiary designations are in sync across all estate documents is pretty basic, IMO, although certainly worth mentioning.

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