Retirement Plan Trusts

Do you have an IRA or 401(k)? You may want to consider a retirement trust as a part of your estate plan.

A majority of Americans have some type of retirement account. A retirement trust allows you to manage those accounts with distributions after death controlled in one document. Retirement trusts provide value to your beneficiaries too, as their disbursements from the retirement account are protected against personal creditors of the beneficiaries of the trust. At the same time, you can capitalize on income tax deferral benefits by stretching out the period for required minimum distributions over the life of your oldest beneficiary. Essentially, your retirement account will continue to grow tax-deferred even after your death.  So, creditors cannot reach the principal of the retirement assets, while the taxes otherwise due on the growth of the retirement funds are not collected as swiftly as would be mandated if the required minimum distributions were not otherwise “stretched” out.

Retirement trusts enhance an estate plan by specifically focusing on retirement account assets that cannot be retitled to other trust vehicles without penalty for early withdrawal and provides instructions to the trustee on the withdrawal requirements for certain retirement accounts. When preparing a retirement trust, you have the option of choosing a conduit, accumulation, or standalone format. Determining which one to use depends on your particular situation and concerns, including the size of the estate plan and ages of the beneficiaries.

Preparing for retirement requires careful analysis to ensure you are receiving all the benefits an estate plan has to offer. Contact our office for experienced guidance and superior services throughout the planning process.

Which Retirement Trust Works BEST for You?

Conduit

Accumulation

Standalone

Required minimum distributions pass through Trust IRA distributions accumulate within Trust Receives and distributes assets
Revocable until death Revocable until death Revocable or Irrevocable
Taxes borne by beneficiaries Taxes borne by Trust Taxes borne by beneficiaries
Limited beneficiary creditor protection for inheritance Extensive asset protection for beneficiaries Extensive asset protection for beneficiaries

X

Contact Form

We will respond to your inquiry in a timely fashion. Thank you.

Quick Contact Form

  • This field is for validation purposes and should be left unchanged.