Retirement & Financial Planning Report

If you inherit an IRA, for maximum tax deferral, you should:

* Check that the beneficiary forms and related paperwork are in place.
* Find out if a long-term stretchout will be permitted. If not, switch to a cooperative custodian.
* Don’t accept checks that terminate an inherited IRA if you want to maintain the tax-deferred compounding.


Nonspouses should insist that the IRA provider keep the IRA in the deceased owner’s name. If the IRA is retitled in the name of a nonspouse, distributions will be accelerated.

If you’re the trustee or the beneficiary of a trust that has been named an IRA beneficiary, notify the custodian as soon as possible that the account should not be re-titled in the name of the trust.

To qualify for a stretchout, the IRA should be kept in the decedent’s name, perhaps in a special “for the benefit of” account.

IRA custodians are responsible for the related paperwork as well as for the assets in the account.