Jump to content

Discalimer of Fractional IRA Proceeds


Guest StanJacobson
 Share

Recommended Posts

Guest StanJacobson

California Probate Code Secs. 260-295 allows a beneficiary to disclaim a fractional IRA distribution. Can the owner of an IRA leave a 100% interest to her husband with the proviso that to the extent Husband disclaims any portion of the IRA distribution, such disclaimed portion shall go to the Family "by-pass" Trust. Again, the amount to go into the Family Trust is determined solely by Husband, NOT IRA owner.

Link to comment
Share on other sites

Guest PVICKERS

I see no reason under IRS regs that a partial disclaimer would not be allowed. The key point is that the disclaimant mey be determining how much goes to the trust, but he has no say over where it goes. That is the critical point in the eyes of the IRS - the disclaimant may not control the destination of the money.

Link to comment
Share on other sites

  • 3 weeks later...
Guest datalife

I know that I'm a little late, but a quick question. Why would anyone disclaim IRA assets. Do they not become taxable with any estate tax plus income tax due immediately? I can reason that if the estate is below the credit threshold, however, it still does not appear to make sense. If you have a minute, please drop me a note. Thanks.

Link to comment
Share on other sites

Guest PVICKERS

I see a number of reasons to disclaim. A spouse may well disclaim to get the assets to a child, so that distributions may be spread over a longer period, thus increasing tax deferral. Alternately, if the disclaimant is in a higher tax bracket than the default recipient, it could be tax intelligent to disclaim. I am sure there are others - if you wish more please contact me email pvickers@allmerica.com

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...