IRA Beneficiaries and second marriages

[Guest PBrinckerhoff]

My clients are a H(65) and W (59) who each have children from a former marriage. They have one large IRA (W is participating spouse) that will be their only retirement assets. They would like proceeds to go 1/3 to his kids and 2/3 to hers. In the event of an early death, how do I provide for the surviving spouse and at the same time ensure that the deceased spouse's beneficiary choices are honored after the death of the first spouse? Is it possible to draft an addendum to the standard IRA beneficiary designation form articulating their wishes as to the ultimate distribution of the IRA proceeds or do they need to put the IRA into a qualified QTIP trust ( I would rather not do the latter as it is quite complex and expensive given the relatively small size of their estate).

[BPickerCPA]

You really need to use a trust to legally insure that everyone's wishes will be followed. Even then there is no guarantee. If it's her IRA and he dies, she can always change the beneficiary and leave his kids out.