What is a Beneficiary Review?

Question: Why is it critical that you have one?

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The beneficiary of an IRA or other retirement account is the person to whom the original account holder wants the account balance to pass to upon his/her death. As your America’s Tax Solutions™ retirement distribution specialist can explain, there are profound tax implications involved in naming beneficiaries. Typically, Uncle Sam stands first in line to inherit 35 to 80% of your hard-earned retirement money! However, your advisor can demonstrate how selecting both primary and contingent beneficiaries for your IRA can grant you the flexibility to leave a tax-deferred financial legacy to your heirs.

Experience has shown us that computerized data is distressingly fragile and that a host of unforeseen calamities can corrupt, erase, or destroy crucial IRA information. Many custodians (banks, brokerage houses, etc.) lose data when they move, downsize, or change operating systems. The longer you have your account with a major financial institution, the greater the likelihood the custodian can no longer identify your beneficiaries or in some cases, even locate the original forms!

AVOID COSTLY MISTAKES BY CONDUCTING ANNUAL BENEFICIARY REVIEWS

For these reasons, America’s Tax Solutions™ recommends a beneficiary review, at least once per year, of all Roth and IRA accounts.

IMPORTANT: Beneficiaries can’t be named or changed after the death of the original account owner! A beneficiary review is the first and most important phase in determining whether or not a “stretch” or Multi-Generational IRA (MGIRA) strategy is available to you.