A client prepared a Revocable Living Trust and has made the trust his Contingent beneficiary on his IRA. His spouse is the primary beneficiary. The trust is Qualified but has a payout to a charity in the amount of $10,000 before any funds are paid out to his children(this assumes his wife predeceases him). I questioned if this impairs the ability to “look thru”. The attorney stated as long as the charity payment is made the trust could “look thru” to the 3 children. Since other assets are held in his trust it makes sense. I assume the charity must be paid before the children receive the IRA assets into their Beneficiary IRA’s? I have a strong opinion to avoid any confusion a client should create a separate trust for their IRA but the attorney felt it was not necessary. The children are close in age, no spendthrift provisions are in trust therefore no reason to create a separate Trust for each child. Client wants a clear delineation as to who gets child’s portion of assets should one predecease him which his Revocable Living Trust delivers.

Any opinion on the “look thru” legality with charity in trust?