With Estate Tax Planning Basically Dead, Here’s a Trust You Should Be Selling to a Lot of Your Clients

ira-inheritance-trust-kaveshBy Philip J. Kavesh, J.D., LL.M. (Taxation), CFP®, ChFC, California State Bar Certified Specialist in Estate Planning, Trust & Probate Law

It’s not a Living Trust (but it does have broad application). Nor is it an Asset Protection or Medicaid Trust (though it does have some asset protection features).

And, thanks to a recent Supreme Court decision, this Trust has been made even better (or more valuable).

Okay, here it is. The Standalone Retirement Trust (or “IRA Beneficiary Trust”, or, as I call it, the “IRA Inheritance Trust®”). It’s simply a trust that acts as beneficiary of a client’s IRAs and other company retirement plans.

Why is this Trust even needed? “Stretchout” and protection.

Stretchout of the required minimum distributions for the beneficiaries – – which can result in substantial long-term, tax-free compounding and much-needed additional retirement funds for later in life. (As to why to use a separate standalone trust, rather than a Living Trust, to achieve this stretchout, click here.)

The other significant benefit of the IRA Inheritance Trust®, which has become more pronounced since the recent U.S. Supreme Court decision in Clark v Rameker, is enhanced protection. Protection against a beneficiary’s bad spending habits, divorce, lawsuits, credits, bankruptcy, and loss of government benefits. The Supreme Court ruled that federal bankruptcy exemptions only apply to an IRA while the original IRA owner is alive, but not to inherited IRAs (or company plans rolled to IRAs).

As a general rule of thumb, the IRA Inheritance Trust® is appropriate if a client (and his or her spouse) have more than $150,000 in IRAs and company plans – – and increasing numbers of retirees do, the very same people you often set up a Living Trust for. Now, you can just show them why to set up a separate “Living Trust for Their IRAsSM”.

The good news is that, not only does this IRA Inheritance Trust® have mass appeal, but it can generate a good, value-added fee because few planners are doing it, and it’s easy to incorporate into a basic, Living Trust-centered practice…if you know how, of course.


Please join us for a very special 3-Part Teleconference Series entitled, “What You Need to Know About IRA Beneficiary Trusts”.  You can register for all 3 programs or each one individually. This series will give everything you need to know about how to add IRA Beneficiary Trust planning to your practice.  Plus, you will receive this presentation, “The Standalone IRA Beneficiary Trust: An Introductory Overview” as a FREE bonus program (a $169 value!) when you sign up for the series!

The series includes the following programs:

For more information about the series and to take advantage of a special bundle price for registering for all 3 programs and receive your FREE Bonus Program, click here.


We have a number of products to help you implement and start doing the IRA Beneficiary Trust type of planning in your practice.

All of these products have been tested and proven to work in Phil’s law firm and are available for a reasonable one-time licensing fee.  Whether  you’re just starting out or you already have an IRA Beneficiary Trust form, these products are a great way to enhance the planning you’re currently offering your prospects and clients and learn from the IRA Trust “Guru” himself!


philip-kavesh-authorAttorney Philip J. Kavesh is the principal of one of the largest estate planning firms in California – – Kavesh, Minor and Otis – – now in its 32nd year of business. He is also the President of The Ultimate Estate Planner, Inc., which provides a variety of training, marketing and practice-building products and services for estate planning professionals. If you would like more information or have a question for him, he can be reached at phil@ultimateestateplanner.com or by phone at 1-866-754-6477.




  1. David F. Sterling, Esq.

    Re: When Worlds Collide

    With nearly 60% of annuity transactions occurring as qualified contracts (IRAs predominantly), I cannot help but wonder about the thoroughness of review procedures conducted by drafting attorneys to ensure compatibility between qualified annuity contract and IRA Inheritance Trust provisions.

    Just imagine the consequences when the heirs learn the Trust was drafted without any attention to this concern. Then, imagine the consequences when they and legal counsel learn that specific annuity contract settlement elections were irrevocable.

    Drafting in a vacuum is a practice of firms from yesteryear. Assets that now inhabit retirement plans and designated trusts are no longer restricted to stocks, bonds and cash. The qualified assets of today often comprise distinct contracts which possess distinct dispositive provisions. Thoughts?


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