IRA Rollover

Submitted by Roger Fine on Fri, 2019-04-26 17:48

When doing a trustee-to-trustee direct rollover of assets from a terminating employer 401-K plan to a new IRA does the IRA (at a brokerage house) need to indicate it is a “rollover” IRA or is “traditional” IRA sufficient. Also, are there any negatives to naming my Revocable Living Trust as Contingent Beneficiary of the IRA after my spouse as Primary Beneficiary, as suggested by my attorney, for asset protection purposes.



Submitted by Alan - IRA critic on Fri, 2019-04-26 18:20

  • The IRA custodian may or may not include “rollover” in the IRA title. There is no requirement to include it, and if it is included when it shouldn’t be, it is not a rollover IRA. Some custodians that do include it leave it that way even after the IRA receives regular contributions or transfers from another IRA that received regular contributions, but in those cases it is no longer a rollover IRA. 
  • The main risk of naming a trust as beneficiary or contingent beneficiary is that the trust may not be a qualified trust or the trustee might miss the deadline for providing the trust info to the custodian. In that case, the RMDs will have to be accelerated. Check to see if your state is one of those that passed creditor protection statutes for inherited IRAs.

Submitted by Roger Fine on Fri, 2019-04-26 19:45

Where will I find thye answer to the above question?

Submitted by Alan - IRA critic on Sat, 2019-04-27 00:09

If you are asking about which states provide creditor protection for inherited IRAs – so far only Arizona, Alaska, Connecticut, Texas, Missouri, Florida, and perhaps Ohio.

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