Americans currently have invested more than $5 trillion in IRA accounts, and much of these assets will eventually pass to heirs. To ensure that as much of these assets pass according to your wishes, be sure you are not making any of these costly IRA mistakes:
- Misplacing the beneficiary form– if your IRA beneficiary form can’t be located after you die, the default provisions of your plan will decide who inherits. The worse case scenario could be to have those assets default to your estate, which would have adverse tax consequences.
- Your beneficiary form is out of date– if you have divorced, remarried or just had a change of heart, if your beneficiary form does not reflect the right person you want to inherit your IRA assets, they will not inherit. Even if you have named the rightful heir in your will, the person(s) named on the beneficiary form will still inherit.
- You have not named a back-up beneficiary– should the person you named as your IRA beneficiary die first and a secondary beneficiary has not been named, the IRA will be liquidated and taxed before going to your estate.
- You have not taken advantage of the stretch– to enable the IRA assets to grow tax-deferred, you can have your beneficiary designation set up to extend payments out over the lifetime of your heir.
- Your assets are not protected– you can use a special trust to protect your child’s inheritance from divorce, bankruptcy, debt collection or just poor money management.
Our experienced and trusted estate planning attorneys have been serving Treasure Coast families for decades, and Michael Fowler is one of only nine attorneys in the state of Florida who is double board-certified in wills trusts and estates and in elder law. Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.
