Protecting IRA assets from a Gambling Problem- Trusteed IRA?
Please help!
We’re working on finding a solution for client (age 69) who is a prominent public figure that has a gambling problem and he wants to limit the ability to access his IRA money. However, because he doesn’t want to public nor his family know about his issue, he can’t do a conservatorship and is looking for a corporate trustee to enforce limitations on how much he can access from his IRA. Does anyone know what companies would open and custodial assets for this type of IRA?
Thanks,
Mike
Permalink Submitted by Alan Spross on Mon, 2007-12-17 21:45
Mike,
Does he want to limit his own access to help avoid the temptation? If so, perhaps he could execute a POA on the account using procedures acceptable to the IRA custodian. However, if he is only concerned with creditors liening his IRA, he would either have complete IRA protection depending on state IRA immunity provisions, or the accounts would also be protected in bankruptcy under the federal bankruptcy act of 2005. Of course, a BK filing would quickly become public information. Also, the IRS can lien his IRA regardless of these protections, as can a spouse in a divorce settlement.
Permalink Submitted by Michael Rautiola on Mon, 2007-12-17 22:36
Alan,
Thanks for your response. He simply wants to restrict his ability to access the IRA money. Therefore, I’m not sure that I understand how a POA would work since he would still have access but only gives authority to an additional person or entity, correct? Can you further explain your thoughts?
Thank you,
Mike
Permalink Submitted by Alan Spross on Mon, 2007-12-17 23:25
You are correct, he would still have access – unless a trusted POA transferred the account such that he did not know how to access it without the POA volunteering the information. I do not think an owned IRA can be transferred to a blind trust like other assets.
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