We often receive the question from our law firm clients, as well as estate planning professionals, about why the standalone IRA Beneficiary Trust, also known as either the IRA Inheritance Trust®, Retirement Beneficiary Trust, or Standalone Retirement Trust (“SRT”), is a better option than using the Living Trust. There are both technical and practical reasons why a standalone trust is a preferable planning option. Our President and estate planning attorney, Philip Kavesh, who drafted the IRA Inheritance Trust® and, with the help of Keebler & Associates, LLP, received the IRS’ stamp of approval through a Private Letter Ruling back in…
Naming IRA Beneficiaries
By Robert S. Keebler, CPA, MST, AEP (Distinguished), CGMA Earlier this year, the IRS released PLR 201417027 in which it refused to extend the deadline to begin required minimum distributions (RMDs), for taxpayers who were not even aware that they were beneficiaries of a decedent’s retirement plan. Because of their seemingly innocent mistake, the missed RMDs might be sliced in half by the 50% excise tax for missed distributions under IRC § 4947(a) and the beneficiaries might be exposed to negligence and understatement penalties under IRC § 6662. This ruling is a reminder of the importance of proper naming of…
Estate Analyst—Clark v. Rameker: No Bankruptcy Exemption for Inherited IRA
By Robert L. Moshman, Esq. It is not often that the Supreme Court provides a clear rule on any aspect of financial planning (or even graces our niche with a passing reference), so these occasions call for special attention. On June 12, 2014, the Supreme Court’s decision in Clark v. Rameker clarified that an inherited IRA is not a protected retirement fund for bankruptcy purposes. Here, we analyze the decision and its impact on planning issues and review the applicable rules and caveats that apply to inherited IRAs. Note: The following discussion of IRAs is about traditional tax-deferred IRAs only…
BREAKING NEWS: Supreme Court Decision on IRA Bankruptcy Case!
A Supreme Court Decision was made in an Inherited IRA bankruptcy case (Clark v. Raemaker), which brought to light the importance for estate planners and clients to utilize a standalone IRA beneficiary trust to better protect IRA assets! As a result of this exciting news, we are pleased to bring to you a very special, limited-time offer… Get 25% off ALL of Our IRA Inheritance Trust® Products! PLUS, we have a very special Bundle Package that allows you to purchase all of our products at an even greater discount (and the option for a monthly payment plan). You will want…
Top 10 Things Every Advisor Needs to Know About Inherited IRAs
By Michael J. Jones, CPA | Volume 2, Issue 6 (June 2014) In my practice, I’m seeing an increase in inherited Individual Retirement Accounts. That’s alerted me to an ever-increasing need for practitioners to review not only how IRAs fit into clients’ financial planning, but also to review and advise them properly regarding the beneficiary form and other key issues. Here are some things advisors and their clients need to keep in mind. An IRA is a ticking tax bomb. Unlike other assets, the income tax basis in an IRA inheritor’s hands will not be its fair market value upon death….
Training on Standalone IRA Beneficiary Trusts
We are holding one of our most popular technical training teleconferences on the IRA Inheritance Trust® tomorrow with our President, estate planning attorney and IRA Inheritance Trust® creator, Philip Kavesh. This teleconference is always one of our most well-attended and popular programs for those looking to add this unique and niche area of planning to their estate planning practice. See below for more information: The Traps and Tricks of Properly Drafting IRA Trusts Speaker: Philip Kavesh, J.D., LL.M. (Taxation), CFP®, ChFC, CA State Bar Certified Specialist in Estate Planning, Trust & Probate Law Date: Wednesday, March 5, 2014 Time: 9am…
Year-End Roth Conversion Planning
By Robert S. Keebler, CPA, MST, AEP (Distinguished) Roth IRA conversions are an important part of bracket management and can be used to avoid the 3.8% net investment income tax (NIIT) and the higher income tax brackets. While some of the benefits of Roth IRA conversions may require a longer period of time to produce, these conversions are still an important strategy to consider at year-end. Advantages of a Roth IRA Roth IRAs have a number of advantages over traditional IRAs: Lower overall taxable income long-term; Tax-free, rather than tax-deferred growth; No required minimum distributions (RMDs) at age 70½;…
Maximizing IRAs Using Trusts: Kavesh Technique Anticipates Boom by Robert L. Moshman, Esq.
Reproduced with the expressed written consent and permission from Robert L. Moshman, Esq., author of the The Estate Analyst. To contact Bob Moshman to be included on his distribution list of his monthly newsletter, e-mail Bob at bmoshman@optonline.net. A Baby Boomer with an otherwise unremarkable estate could leave behind a supercharged IRA that empowers beneficiaries. Philip J. Kavesh, a veteran estate planning attorney who has trained thousands of financial professionals, took part in designing the IRA Inheritance Trust® and successfully obtained a Private Letter Ruling for the technique in 2005. Although several variations of “stretch-out” or “see-through” trusts have performed…
Beneficiary Designation Problems with IRAs: More Than Just the RMD Rules!
By Kristen M. Lynch, J.D., AEP, CISP, CTFA with Robert S. Keebler, CPA, MST, AEP (Distinguished) In the world of estate and retirement planning, I have been fortunate enough to have been cross-trained as both a trust officer and an attorney. As a trust officer, I was charged with being the divisional manager and administrator for all of the IRAs within a large regional bank’s trust department. In that role, I was responsible for ensuring that the bank’s IRA clients took their required minimum distributions (“RMD’s”), coordinated estate planning and post-mortem issues with the IRA client’s legal and tax…
The Real Deal with IRAs and Lawsuit Protection
Reproduced with permission from Jeffrey M. Verdon Law Group, LLP. There are very few assets we own that are more sacred than our retirement plans. Under general legal principles and public policy, most jurisdictions exempt retirement accounts, such as 401Ks and IRAs, from creditors. However, in a recent court case, the so-called “inherited IRA,” was held not to have such “firewall” creditor protection. An inherited IRA is nothing more than an IRA that is passed from the owner of an IRA at his or her death to the designated beneficiary. In general, sound public policy supports the stance that because…