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An Inherited IRA Is Not a 'Retirement' Account for Purposes of Bankruptcy Protection
Michael Kitces in Nerd's Eye View Link to more items from this source
June 25, 2014
"From a proactive planning perspective, the Clark decision will likely make it far more appealing for spousal beneficiaries to roll over inherited retirement accounts rather than leaving them as inherited IRAs, and non-spouse beneficiaries may increasingly prefer to inherit retirement accounts via a trust on their behalf, taking advantage of the 'see-through' trust regulations to ensure the inherited IRA can still stretch its distributions to the trust itself. On the other hand, the acknowledgment by the Supreme Court that a retirement account effectively ceases to be a preferential account (for asset protection purposes at least) after the death of the original owner also raises the question of whether Congress' recent proposals to curtail the use of stretch IRAs altogether and force most beneficiaries to use the 5-year rule may soon come to pass as well!"

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