Would you like to help ensure your kids "stretch" IRA benefits?

I came across this article in the AARP discussing "stretch" IRAs. (Click here for AARP article). A "stretch-IRA" can be a great benefit for your kids. The goal of course is to ensure that they can take advantage of the tax deferral benefits that you took advantage of during your lifetime. Sounds great right? So what is the problem?

The problem is that without proper estate planning, there is no way to keep the kids from taking the money in a lump sum, and not taking advantage of the tax benefits of "stretch-out."

So what is the solution?

Consider discussing an IRA Trust with your Estate Planning Attorney and Financial Advisor. Generally, these trusts can help ensure that your kids take advantage of the tax benefits by not permitting distributions for anything other than: 1) the required minimum distributions per the Tax Law; and 2) special circumstances that you determine and have your attorney draft into the Trust (e.g. educational or medical needs).

IRA Trusts can be a very powerful tool in your estate plan. That being said, these types of trusts must be drafted and administered in strict compliance with applicable Tax and Trust Laws.

I am a Connecticut Estate Planning Attorney, and if you would like to discuss how this tool could be beneficial in your estate plan then feel free to reach out to me by clicking here for my contact information.