Testamentary trust IRA beneficiary
Client has 4 children. One is on state assistance and client will be establishing testamentary trust for her benefit. Do 3 children receive designated beneficiary status (10 year rule) and the trust would fall under the 5 year rule?
Permalink Submitted by Kim Shields on Wed, 2023-11-08 17:52
The trust can qualify for the 10 year rule if it meets the requirements for a See-Through Trust.
Permalink Submitted by Alan - IRA critic on Wed, 2023-11-08 17:59
The other 3 children named directly as beneficiaries would fall under the 10 year rule with annual beneficiary RMDs only required if client passes after their RBD.
Permalink Submitted by Kevin Kennedy on Wed, 2023-11-08 18:24
Can you leave 75% to named designated beneficiaries and 25% to the estate. The will would create the testamentary trust in order to protect the state benefits the one child is receiving, realizing this would trigger the 5 year rule for that 25%.