If you have a traditonal IRA worth $1,500,000 and you have set up a special IRA living trust. Does this allow your heirs to spread the income recieved over a 5 year period instead of taking it all in that year?

There is no such thing as a special IRA living trust. The question of whether you have to take an inherited IRA over five years, one year, or the life expectancy of the oldest beneficiary is based upon a number of factors including when the decedent dies. If a trust is the beneficiary, then the trust has to be written in a way that it qualifies the oldest trust beneficiary to be a designated beneficiary.

Things sound a little confused in your question.

Barry