Businesses should have a Buy-Sell Agreement

October 4, 2021

Businesses should have a buy-sell agreement to protect the owners, their families, employees and the company. Without a buy-sell agreement or succession plan, any company is at risk, notes a recent article titled “Why does your business need a buy-sell agreement?” from the Philadelphia Business Journal.

Many business owners are reluctant to recognize the possibility of their becoming disabled or dying, so they put off creating a buy sell agreement. However, as we all know, unexpected events happen and it’s always better to be prepared.

A buy-sell agreement offers protection first by establishing what type of triggering events could happen and defining the terms and conditions for how shareholders will enter and exit their ownership of the business.

Companies often have a buy-sell agreement stuck in a file drawer from ten or twenty years ago. Chances are that big changes have taken place in the business and the old agreement is no longer relevant. The day-to-day operations of a business are pressing, and there’s never enough time to get around to it. However, when the unexpected occurs, shareholders are left to negotiate among themselves during the worst possible time.

A well-drafted buy-sell agreement for a business should address the most common events: death, disability, divorce, personal bankruptcy, voluntary termination, retirement and involuntary separation. The agreement should clearly state the percentage and type of ownership, how shares are valued and how any insurance proceeds are to be handled. Without knowledge of the value and terms of payment, there’s no way to provide protection for a triggering event.

Once the value of the company and its shareholders is defined, it may become clear that a business needs to close a valuation gap.

The intentions for the future of the business can also be clarified through this process. Some provisions to consider are:

How to notify other shareholders, in the event of a voluntary termination.
Trailer provisions to protect exiting shareholders, in the event of a subsequent liquidity event.
Discounts on value or extended payment terms for non-compliance of notification provisions.
Insurance portability provisions to allow existing shareholders to reassign beneficiary designations (once payments owed to the exiting shareholder have been made).

Businesses should have a buy-sell agreement. They are dynamic entities with frequent changes, so buy-sell agreements should be reviewed and updated in the same way that an estate plan needs to be updated—every three or four years. If you would like to read more about buy-sell agreements, and other succession planning topics, please visit our previous posts.

Reference: Philadelphia Business Journal (Sep. 1, 2021) “Why does your business need a buy-sell agreement?”

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What’s an Enhanced Life Estate?

September 30, 2021

What’s an enhanced life estate? This topic comes up from time to time with older couples of retirement age. First Coast News’ recent article entitled “Deed named for former first lady could be key to planning your estate” explains that a strategy that’s available in Florida and a few other states is called an enhanced life estate or a “Lady Bird” deed, named after former First Lady, Lady Bird Johnson.

This deed states that when I die, you get the property, but until then, I reserve all rights to do whatever I want with it. That contrasts with a traditional life estate where a property owner can plan for one or more others to inherit their house.

Typically, the person with a life estate has a lot less control over what happens in the future, including potentially being thwarted by the very person you’re tapping to receive your property at your death, in case you decide you no longer want the house while you’re still alive.

The problem is, now you want to sell the property, but since they are a co-owner, they can refuse. And there’s nothing you can do about it.

Enhanced life estates are also about protecting property and its eventual recipient from creditors after the death of the owner. That’s the benefit of avoiding probate. Medicaid or any other creditor may become a creditor in probate.

A Lady Bird deed supersedes a will.

But there are downsides to the Lady Bird deed. A big drawback is if you change your mind. You have to now record another deed in the public record to remove that, and every deed that you record creates one thing that could go wrong.

However, this can be true of any change made in hope of overriding an earlier estate decision, and Lady Bird deeds are fairly straightforward. Understanding what an enhanced life estate does will help avoid any pitfalls. Ask an experienced estate planning attorney if this type of arrangement is available in your state.

If you would like to read more about enhanced life estates, or other types of deeds for property, please visit our previous posts.

Reference: First Coast News (July 19, 2021) “Deed named for former first lady could be key to planning your estate”

Plan Carefully before withdrawing Retirement Funds

September 29, 2021

As much as 70% of your retirement funds could evaporate after income tax, estate and state taxes, says a recent article titled “9 smart ways to withdraw retirement funds,” from Bankrate.com. While this number may sound extreme, a closer look shows how easily it could happen, even to families who are well under today’s high federal estate tax exemptions. It is wise to plan carefully before withdrawing retirement funds. Here’s how to avoid this minefield.

Watch the rules on RMDs—Required Minimum Distributions. Once you turn 72, you’re required to start taking a minimum amount from tax-deferred retirement accounts, including traditional IRAs and 401(k)s. The penalty for failing to do so is severe: a 50% excise tax. If you get the math wrong and don’t take out enough money, the penalty is just as bad. Let’s say your RMD is $20,000 but somehow you only take $5,000. The IRS will levy a $7,500 tax bill: half the $15,000 you were supposed to pay. Ouch!

When you calculate your RMD, remember it changes from year to year. The RMD is based on your age, life-expectancy and account balance, which is the fair market value of the assets in your accounts on December 31 the year before you take a distribution.

Take withdrawals from accounts in the right order. Which retirement funds should you withdraw from first? A Roth IRA will be tax free but use taxable accounts first and leave the Roths for later. Here’s why.

If a 72-year-old person takes $18,000 from a traditional IRA in the 24% tax bracket, their tax bill will be $4,320. The same withdrawal from a Roth IRA won’t create any tax liability. However, if they leave the Roth alone and earn 7% annually on the $18,000 for another ten years, it could grow to $35,409, which will also be tax free when withdrawn. It’s worth the wait.

Do you know the way to take distributions? Most Americans have had several jobs and have retirement accounts in different institutions. It may be time to consolidate assets into one IRA. This can make it much easier to calculate future withdrawals, tax liabilities and asset allocation. Plan carefully before withdrawing, you may need help from your estate planning attorney. You can’t take withdrawals from an IRA to meet RMD requirements for 403(b)s, 401(k)s or other plans. 401(k) plans may not be pooled to calculate a single RMD. Handle any consolidations with great care to avoid incurring tax penalties.

RMDs are different in some situations. If one spouse is significantly younger than the other, RMDs might be lowered. RMDs are calculated using factors like life expectancy (as determined by IRS tables). If a spouse is the sole beneficiary of an IRA, and they are at least ten years younger than you, the RMD calculation is done using a joint-life expectancy table. The amount of the RMD will be reduced according to the table.

Charitable contributions count. People aged 70½ or older are permitted to make tax free donations, known as qualified charitable distributions, of up to $100,000 to a charity as part of their RMD. This distribution does not count as income, reducing income tax to the donor. If you file a joint return, a spouse may also make a contribution up to $100,000. You can’t itemize these as a charitable deduction, but it’s a good way to minimize taxes.

Withdrawals don’t have to be cash. RMDs can be stocks or bonds, which are assigned a fair-market value on the date they are moved from the IRA to a taxable account. This may be easier and less expensive than triggering fees by selling securities in an IRA and then buying them back in a brokerage account.

Can you delay RMDs if you’re still working? If you’re still working at age 72 and continuing to fund a 401(k) or 403(b), you can delay taking RMDs, as long as you don’t own more than 5% of a company and your retirement plan permits this. Check with the 401(k) custodian or human resources to be sure this is allowable to avoid expensive penalties.

Smart money management is just as important in taking money from your retirement accounts as it is in building those accounts. Plan carefully before withdrawing retirement funds. Make informed decisions to maximize your savings and minimize taxes.

If you would like to read more about retirement accounts and estate planning, please check out our previous posts.

Reference: Bankrate.com (Aug. 31, 2021) “9 smart ways to withdraw retirement funds”

Pot Trust gives you added Flexibility

September 28, 2021

A pot trust gives you added flexibility as to the way in which the trust assets are used, if you plan to leave your entire estate to your children, says Wealth Advisor’s recent article entitled “How Does a Pot Trust Work?” It’s also called a discretionary, sprinkling or common pot trust and is a type of trust that can be used by families to pass on assets. Minor children serve as beneficiaries with a trustee overseeing the management of trust assets. The trustee has discretionary power to decide how the trust funds are used to pay for the care and needs of beneficiaries.

Flexibility is key in family pot trusts, since the assets are distributed based on the children’s needs, rather than setting specific distribution rules as to who gets what. You might consider this type of trust over other types of trusts if: (i) you have two or more children; and (ii) at least one of those children is a minor. As long as the trust is in place, the trustee determines how trust assets may be used to provide for the beneficiaries’ well-being. This trust is designed to address the financial needs of individual children as they arise, and there’s no requirement for trust assets to be divided equally among them.

Pot trusts can give flexibility to parents who want to make certain the needs of their children will be met in the event something happens to them. If both parents were to die, a pot trust could provide money to cover basic living expenses, as well as other costs that might arise. You can decide when the trust should end, based on the ages of your children, if ever. Children can also still get distributions from the trust once it terminates, if all trust assets haven’t been used.

However, pot trusts don’t ensure an equal distribution of assets among multiple children. A family pot trust can also put an increased burden on the trustee because the trustee must in effect assume a parental role when it comes to financial decision-making. There’s no predetermined set of instructions left behind by the trust grantor.

However, if you’re worried about issues of fairness or older children having to wait to receive trust assets, ask an experienced estate planning attorney about creating individual trusts instead, so that you can designate specific assets to be added to each trust and provide instructions to the trustee on how those assets should be managed. An individual trust gives you more control over what happens with the trust assets. You can also say what portion of your estate each child should receive.

A pot trust will provide the flexibility you want, but still requires careful consideration as you distribute assets amongst your family. Work with you estate planning attorney to ensure this type of trust is the right option for you. If you would like to learn more about different types of trusts, please visit our previous posts.

Reference: Wealth Advisor (Aug. 31, 2021) “How Does a Pot Trust Work?”

Using Cryptocurrency in your Estate Planning

September 27, 2021

Cryptocurrency is a digital currency that can be used to buy online goods and services, explains Forbes’ recent article entitled “Cryptocurrency And Estate Planning: What Digital Investors Should Know.” Part of cryptocurrency’s appeal is the technology that backs it. Blockchain is a decentralized system that records and manages transactions across many computers and is very secure. If you are intent on using cryptocurrency in your estate planning, there are things you need to know.

As of June 24, the total value of all cryptocurrencies was $1.35 trillion, according to CoinMarketCap. There are many available cryptocurrencies. However, the most popular ones include Bitcoin, Ethereum, Binance Coin and Dogecoin. Many believe cryptocurrency will be a main currency in the future, and they’re opting to buy it now. They also like the fact that central banks are not involved in the process, so they can’t interfere with its value.

In addition, NFTs or non-fungible tokens, are also gaining in popularity. Each token is one of a kind and they’re also supported by blockchain technology. They can be anything digital, such as artwork or music files. NFTs are currently being used primarily as a way to buy and sell digital art. An artist could sell their original digital artwork to a buyer. The buyer is the owner of the exclusive original, but the artist might retain proprietary rights to feature the artwork or make copies of it. The popularity of NFTs is centered around the social value of fine art collecting in the digital space.

Here are three reasons to have an estate plan, if you buy bitcoin:

No probate. Even if your loved ones knew you were using cryptocurrency, and even if they knew where you stored your password, that wouldn’t be enough for them to get access to it. Without proper estate planning, your cryptocurrency assets may be put through a lengthy and expensive probate process.
Blockchain technology. You must have a private key to access each of your assets. It’s usually a long passcode. A comprehensive estate plan that includes this can help you have peace of mind knowing that your investments can be passed on to loved ones’ if anything were to happen to you unexpectedly.
Again, central banks don’t play any part in the process, and it’s secure because its processing and recording are spread across many different computers. However, there’s no governing body overseeing the affairs of cryptocurrency.

Using cryptocurrency in your estate planning could have benefits and consequences. Speak with your estate planning attorney to make sure you have a full grasp on how it works.

If you would like to read more about cryptocurrency and other digital assets, please visit our previous posts.

Reference: Forbes (July 21, 2021) “Cryptocurrency And Estate Planning: What Digital Investors Should Know”

The Estate of The Union Season 3|Episode 9

The Estate of The Union Episode 9 out now!

September 24, 2021

The Estate of The Union Episode 9 out now! In the latest installment, Brad Wiewel of Texas Trust Law chats with Grace Cook of Harrell Funeral Home about a subject that is often overlooked – pre-planning your funeral.

Planning a funeral can be a daunting task for loved ones still grieving. It can also be an overwhelming financial burden on the family. Pre-arranging your own service will help to ease the burden of your loved ones. It will also alleviate any questions, problems or differences, which can occur among family members. The arrangements you make will reflect your exact wishes and desires. You can give this gift of love by providing meaningful final instructions.

Brad and Grace share a lively discussion of the common problems she sees with funeral planning, as well as some of the more unique and special ways families have arranged memorials for the deceased. It can seem like a heavy subject, but pre-planning your funeral might be the last, best plan you ever make!

In each episode of The Estate of The Union podcast, host and lawyer Brad Wiewel will give valuable insight into estate planning, making an often daunting subject easier to understand.

It is Estate Planning Made Simple!

Harrell Funeral Home is the largest family-owned funeral home in Austin and the surrounding areas. You may reach them at harrellfuneralhomes.com.

The Estate of The Union can be found on Spotify, Apple podcasts, or anywhere you get your podcasts. Please click on the link below to listen to the new installment of The Estate of The Union podcast. The Estate of The Union Episode 9 out now. We hope you enjoy it.

Texas Trust Law/Texas Trust Law focuses its practice exclusively in the area of wills, probate, estate planning, asset protection, and special needs planning. Brad Wiewel is Board Certified in Estate Planning and Probate Law by the Texas Board of Legal Specialization.

What Should Women Know about Long-Term Care?

September 23, 2021

A longer retirement increases the odds of needing long-term care. An AARP study found more than 70% of nursing home residents were women, says Kiplinger’s recent article entitled “A Woman’s Guide to Long-Term Care.” What should women know about long-term care?

Living longer also increases the chances of living it alone because living longer may mean outliving a spouse. According to the Joint Center for Housing Studies of Harvard University, “In 2018, women comprised 74% of solo households age 80 and over.”

The first step is to review your retirement projections. It’s wise to look at “what-if” scenarios: What-if the husband passes early? How does that impact their retirement? What if a female client lives to 100? Will she have enough to live on? What if a single woman needs long-term care for dementia? Alzheimer’s and dementia can last for years, eating up a retiree’s nest egg.

Medicare and Medicaid. Government programs, such as Medicare and Medicaid, are complicated. For instance, Medicare may cover some long-term care expenses, but only for the first 100 days. Medicare doesn’t pay for custodial care (at home long-term care). Medicaid pays for long-term care. However, you must qualify financially.

Planning for long-term care. If a woman has a high retirement success rate, she may want to self-insure her future long-term care expenses. This can mean setting up a designated long-term care investment account solely to be used for future long-term care expenses. If a woman has a modest degree of retirement success, she may want to lower her current expenses to save more for the future. She may also want to look at long-term care insurance.

Social Security. Women can also think about waiting to claim Social Security until age 70. If women live longer, the extra benefits accrued by waiting can help with long-term care. Women with a higher-earning husband may want to ask the higher-earning spouse to delay until age 70, if possible. When the higher-earning spouse dies, the widow can step into the higher benefit. The average break-even age is generally around 77-83 for Social Security. If an individual can live longer than 83, the more dollars and sense it makes to delay collecting until age 70.

Estate Planning. Having a comprehensive estate plan is a must. Women (and men) should have a power of attorney (POA). A POA gives a trusted agent the ability to write checks and send money to pay for long-term care.

When it comes to long-term care, women should know their own health and the potential drain on the retirement savings. Work with a financial advisor and estate planning attorney to make sure your later years are secure.

If you would like to learn more about long-term care, please visit our previous posts.

Reference: Kiplinger (July 11, 2021) “A Woman’s Guide to Long-Term Care”

Many Benefits of 529 Plans

September 22, 2021

There are many benefits of 529 college saving plans. You might think that tax-deferred savings is the main benefit, along with tax-free withdrawals for qualifying higher education expenses. However, there are also state tax incentives, such as tax deductions, credits, grants, or exemption from financial aid consideration from in-state schools in certain states.

Forbes’ recent article entitled “7 Benefits You Didn’t Know About 529 College Savings Plans (But Should)” says there are many more advantages to the college savings programs than simple tax benefits.

1) Registered Apprenticeship Programs Qualify. You can make qualified withdrawals from a 529 plan for registered apprenticeship programs. These programs cover a wide range of areas with an average annual salary for those that complete their apprenticeship of $70,000.

2) International Schools Usually Qualify. More than 400 schools outside of the US are considered to be qualified higher education institutions. You can, therefore, make tax-free withdrawals from a 529 plan for qualifying expenses at those colleges.

3) Gap Year and College Credit Classes for High School. Some gap year programs have partnered with higher education institutions to qualify for funding from 529 accounts. This includes some international and domestic gap year, outdoor education, study-abroad, wilderness survival, sustainable living trades and art programs. Primary school students over 14 can also use 529 funds for college credit classes, where available.

4) Get Your Money Back if Not Going to College. If your beneficiary meets certain criteria, it’s possible to avoid a 10% penalty and changing the plan from tax-free to tax-deferred. For this to happen, the beneficiary must:

Receive a tax-free scholarship or grant
Attend a US military academy
Die or become disabled; or
Get assistance through a qualifying employer-assisted college savings program.

Note that 529 plans are technically revocable. Therefore, you can rescind the gift and pull the assets back into the estate of the account owner. However, there are tax consequences, including tax on earnings plus a 10% penalty tax.

5) Private K–12 Tuition Is Qualified. 529 withdrawals can be used for up to $10,000 of tuition expenses at private K–12 schools. However, other expenses, such as computers, supplies, travel and other costs are not qualified.

6) Pay Off Your Student Loans. If you graduate with some money leftover in a 529 account, it can be used for up to $10,000 in certain student loan repayments.

7) Estate Planning. Contributions to a 529 plan are completed gifts to the beneficiary. These can be “superfunded” for up to $75,000 per beneficiary in a single year, effectively using five years’ worth of annual gift tax exemption up front. For retirees with significant RMDs (required minimum distributions) from qualified accounts, such as 401(k)s and traditional IRAs, the 529 plan offers high contribution limits across multiple beneficiaries, while retaining control of the assets during the lifetime of the account owner. Assets also pass by contract upon death, avoiding probate and estate tax.

Work closely with your financial advisor and estate planning attorney to ensure you are getting the most benefits out of your 529 college saving plans.

If you would like to read more about 529 plans, please visit our previous posts.

Reference: Forbes (July 15, 2021) “7 Benefits You Didn’t Know About 529 College Savings Plans (But Should)”

Which Trust Is Right for You?

September 21, 2021

Everyone wins when estate planning attorneys, financial advisors and accounting professionals work together on a comprehensive estate plan. Each of these professionals can provide their insights when helping you make decisions in their area. Guiding you to the best possible options tends to happen when everyone is on the same page, says a recent article “Choosing Between Revocable and Irrevocable Trusts” from U.S. News & World Report. Which trust is right for you?

What is a trust and what do trusts accomplish? Trusts are not just for the wealthy. Many families use trusts to serve different goals, from controlling distributions of assets over generations to protecting family wealth from estate and inheritance taxes.

There are two basic kinds of trust. It can be difficult to know which trust is right for you and your family situation. There are also many specialized trusts in each of the two categories: the revocable trust and the irrevocable trust. The first can be revoked or changed by the trust’s creator, known as the “grantor.” The second is difficult and in some instances and impossible to change, without the complete consent of the trust’s beneficiaries.

There are pros and cons for each type of trust.

Let’s start with the revocable trust, which is also referred to as a living trust. The grantor can make changes to the trust at any time, from removing assets or beneficiaries to shutting down the trust entirely. When the grantor dies, the trust becomes irrevocable. Revocable trusts are often used to pass assets to adult children, with a trustee named to manage the trust’s assets until the trust documents direct the trustee to distribute assets. Some people use a revocable trust to prevent their children from accessing wealth too early in their lives, or to protect assets from spendthrift children with creditor problems.

Irrevocable trusts are just as they sound: they can’t be amended once established. The terms of the trust cannot be changed, and the grantor gives up any control or legal right to the assets, which are owned by the trust.

Giving up control comes with the benefit that assets placed in the trust are no longer part of the grantor’s estate and are not subject to estate taxes. Creditors, including nursing homes and Medicaid, are also prevented from accessing assets in an irrevocable trust.

Irrevocable trusts were once used by people in high-risk professions to protect their assets from lawsuits. Irrevocable trusts are used to divest assets from estates, so people can become eligible for Medicaid or veteran benefits.

The revocable trust protects the grantor’s wishes, if the grantor becomes incapacitated. It also avoids probate, since the trust becomes irrevocable upon death and assets are outside of the probated estate. The revocable trust may include qualified assets, like IRAs, 401(k)s and 403(b)s.

However, there are drawbacks. The revocable trust does not provide tax benefits or creditor protection while the grantor is living.

Your estate planning attorney will know which trust is right for your situation, and working with your financial advisor and accountant, will be able to create the plan that minimizes taxes and maximizes wealth transfers for your heirs. If you would like to learn more about the different types of trusts available, please visit our previous posts.

Reference: U.S. News & World Report (Aug. 26, 2021) “Choosing Between Revocable and Irrevocable Trusts”

How to Handle an Inherited IRA

September 20, 2021

You can’t leave the money in an original IRA inherited from the deceased. There are several ways you can take the funds after inheriting either a traditional or Roth IRA. However, your options will be restricted by several factors. Note that failure to handle an inherited IRA properly can lead to a significant penalty from the IRS.

Kiplinger’s recent article entitled “I Inherited an IRA. Now What?” says you should understand what type of beneficiary you are under the new SECURE Act, what options are available to you and how they fit into your tax and investment profile.

There are several different ways to handle an inherited IRA. The first step after being left an IRA is getting the details about the account. This includes whether it’s a traditional IRA or a Roth IRA. Unlike Roth IRAs, traditional IRAs require the owner to take minimum withdrawals or “Required Minimum Distributions” (RMDs), when they turn 72. As a result, if the original account owner was older than 72 when they died, be certain that the RMD has been taken for the year. If not, there’s a potentially significant IRS penalty. You should also identify when the account was opened. This may exempt you from taxes later on, if you inherited a Roth IRA. It is also recommended that you verify that you are the sole beneficiary.

Spousal Heirs Can Transfer the Funds to a New IRA. Spousal heirs can transfer the assets from the original owner’s account to their own existing or a new IRA. You can do this even if the deceased was over 72 and was taking RMDs from a traditional IRA. With your existing or new account, you can delay RMDs until you reach 72. You can also complete this type of transfer with a Roth. Since these accounts don’t require RMDs, you don’t need to worry about withdrawals. This is a good option for beneficiaries who are younger than their deceased spouses and don’t need the income at that point. Transferring the funds to your own traditional IRA lets you delay taking RMDs. However, if you’d like to withdraw the funds from the new IRA before you are 59½, you’ll be subject to the 10% early-withdrawal penalty.

Spousal Stretch IRA. Spousal heirs who inherit either a traditional or a Roth IRA can transfer the assets into an inherited IRA, which is different than a spousal transfer. The original account owner’s financial institution will require you to open the inherited IRA with them, but you can also move the funds to a new institution. First, open an inherited IRA at the original owner’s institution and then open an inherited IRA at the institution to which you want to move the account. Request a direct IRA-to-IRA transfer. When titling the account, follow the format: “[Decedent’s Full Name], for benefit of [Beneficiary’s Full Name]” or “[Beneficiary’s Full Name], as beneficiary of [Decedent’s Full Name].”

Once you have a handle on the inherited IRA, you can withdraw the funds in two ways: (i) the life expectancy method is where you take annual distributions based on your own life expectancy, not the original owner’s (also known as a “stretch IRA”); or (ii) the 10-year method, where you must withdraw all funds within 10 years.

Non-Spousal Heirs Have Limited Choices. The SECURE Act of 2019 got rid of the stretch IRA for non-spousal heirs who inherit the account on or after Jan. 1, 2020. The funds from the inherited IRA – either a Roth or a traditional IRA – must be distributed within 10 years of the original owner passing away, even if the deceased person died before or after the year in which they reach age 72. There are exceptions, such as when the heir is a minor, disabled, or more than a decade younger than the original account owner. In these cases, they can withdraw the funds using the stretch IRA method.

If you’re required to take out the funds within 10 years, you don’t need to withdraw a certain amount of money each year from an inherited IRA. You can leave the funds to grow in the account tax deferred the entire time and then withdraw the funds at the end. However, if you withdraw too much in one year, it could move you into a higher tax bracket.

Lump Sum. All beneficiaries can take the funds in one large distribution, either from a traditional or Roth IRA. However, this is generally discouraged for those with traditional IRAs because they’ll have to pay income taxes on the distribution all at once and may move to a higher tax bracket.

Plan for Taxes. If you inherit a Roth IRA, you shouldn’t have to pay taxes on distributions if the original account was opened at least five years ago, or a conversion from a traditional IRA to a Roth occurred at least five years ago. Determine when the original account was opened to see if some of the distribution will be taxable. Make sure you know how to handle an inherited IRA. Talk with an estate planning attorney today.

If you would like to read more about IRAs and other retirement accounts, please visit our previous posts.

Reference: Kiplinger (Aug. 4, 2021) “I Inherited an IRA. Now What?”

Blog Articles

Businesses should have a Buy-Sell Agreement

What’s an Enhanced Life Estate?

Plan Carefully before withdrawing Retirement Funds

Pot Trust gives you added Flexibility

Using Cryptocurrency in your Estate Planning

The Estate of The Union Episode 9 out now!

Many Benefits of 529 Plans

Which Trust Is Right for You?

How to Handle an Inherited IRA

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