fraud or allowable by irs

[Guest whototrust]

Lot's of questions and hopefully someone can help with the answers. Does the irs allow a poa to change beneficiary designations on an ira or is this just up to the bank's own policies? Can a poa choose to elect ownership or choose to decline ownership for the deceased's spouse? Would a spouse have to elect to treat the ira as her own in order to change beneficiary status (this was supposedly done by poa)The ira owner is deceased, can the surviving spouse, or her poa, change only her beneficial interest to a trust in which she has no control, or can a change be made to include the remainder beneficiay of the ira as well? What it boils down to is this - if a trust seems to prevent ownership due to limitations on the ability to access funds and since RMD's have routinely been taken out by the trustee, can owenership occur and if not, can a beneficiay change be made by someone not the owner, but only beneficiary? Trying to figure out what has gone on is very confusing, if anyone can offer some help, please do!

[masteff]

My very non-expert understanding is: it depends. It depends on the exact wording used in the POA. It depends on governing state law. It depends on the IRA document and the policies of the IRA company.

And half way thru, you switch from asking about an IRA to asking about a trust. A trust is an even bigger "it depends" because state law is going to play a role in both governing the POA and governing the trust.

You really need to consult a lawyer. This is beyond the ability of strangers who do not have access to the complete facts.

[Guest whototrust]

My very non-expert understanding is: it depends. It depends on the exact wording used in the POA. It depends on governing state law. It depends on the IRA document and the policies of the IRA company.

And half way thru, you switch from asking about an IRA to asking about a trust. A trust is an even bigger "it depends" because state law is going to play a role in both governing the POA and governing the trust.

You really need to consult a lawyer. This is beyond the ability of strangers who do not have access to the complete facts.

Thanks, I know it's confusing at best. I didn't realize that state law as well as federal affects this, so I'll look there. I've only been looking at the OCC and the irs for applicable law. The poa gave himself permission to change beneficiary status, this power was unknown to my mother. I'm searching for some law that would prevent him from doing what he did, which amounts to financially exploiting the elderly.

[K2retire]

The POA document should spell out what the agent can or cannot do.

[mbozek]

Lot's of questions and hopefully someone can help with the answers. Does the irs allow a poa to change beneficiary designations on an ira or is this just up to the bank's own policies? Can a poa choose to elect ownership or choose to decline ownership for the deceased's spouse? Would a spouse have to elect to treat the ira as her own in order to change beneficiary status (this was supposedly done by poa)The ira owner is deceased, can the surviving spouse, or her poa, change only her beneficial interest to a trust in which she has no control, or can a change be made to include the remainder beneficiay of the ira as well? What it boils down to is this - if a trust seems to prevent ownership due to limitations on the ability to access funds and since RMD's have routinely been taken out by the trustee, can owenership occur and if not, can a beneficiay change be made by someone not the owner, but only beneficiary? Trying to figure out what has gone on is very confusing, if anyone can offer some help, please do!

Your facts are too jumbled to give a coherent answer.

Who is principal who gave the power to the agent, (who you refer as the POA)? Was it the IRA owner, the spouse?

What is the property that the agent/POA has authority over?

Is it the inherited IRA in which the spouse is the beneficiary? A trust?

Who is the trustee and what property does the trustee control in the trust?

Is the trust the beneficiary of the IRA distributions?

POAs are governed by state law and each state has different laws and rules regarding the powers that can be delegated to the agent. NY has a statutory short form POA that lists 16 separate powers that the agent can be given if the principal wishes to delegate authority. The principal can delegate all or some of the enumerated powers. Also the powers of attorney granted to the agent expire upon the death of the principal who granted the power.

Finally the agent is a fiduciary acting on behalf of the principal and cannot take action under the POA to benefit himself, even if the power to take action is delegated under the POA.