Take-Away: As I promised yesterday, what follows is an example of how an IRA Beneficiary Designation should be written if the IRA is payable to the irrevocable Trust on the owner’s death and the goal is for each trust beneficiary to exploit the ‘stretch IRA’  concept where each trust beneficiary is free to use his […]

Take-Away: All too often individuals make mistakes when they divide their IRA accounts in a divorce. The some problems arise from confusing IRA and qualified retirement plan rules; another problem can be caused by jumping the gun. Background: These days a major asset accumulated during a marriage is an IRA. How that IRA gets divided […]

Take-Away: Frequently we are faced with an irrevocable trust that the settlor, or the trust beneficiaries, want to modify for some reason. Ignoring a trustees’ power to decant the trust assets to a new trust, can the trust’s provisions be modified by agreement? Michigan’s Trust Code permits an irrevocable trust to be modified, but ultimately […]

Take-Away: There is a tension between the trustee’s duty to treat trust beneficiaries impartially and the trustee’s power to decant the trust assets to a new trust to remove trust beneficiaries or curtail the rights of existing trust beneficiaries under an trust. Balancing that fiduciary duty of impartiality with the exercise of the trustee’s statutory […]

Take-Away: A week ago I provided a review of the stretch IRA rules. I mentioned that often there are a lot of mistakes either in applying required minimum distribution (RMD) rules or making assumptions that are not always accurate. What follows are some mistakes and misconceptions often encountered in the world of IRAs. Failure to […]

Take-Away: In past weeks we have had discussions about the difference between per stirpes and per capita used in wills, trusts and beneficiary designations and other formal ‘rules of construction.’ Despite  long-standing definitions of these terms, their causal use can still create disputes in the interpretation of a will or trust where these terms are […]

Take-Away: The tax planning concept of stretch IRAs survived the 2017 Tax Cut Act, and reports of the stretch IRA’s demise were premature. Stretch IRAs are still with us, but so are the often byzantine rules with regard to distributions from an inherited IRA. With the reprieve of the stretch IRA distribution rules let’s consider […]

Take-Away: In 2016 the Department of Labor expanded ERISA’s definition of investment advice fiduciary to include investment advice that is given with regard to an IRA account, informally called the Fiduciary Rule. This Rule has endured a rocky start. With the new administration in Washington, the implementation of the Fiduciary Rule has been delayed until […]

Take-Away: Sometimes what we do not treat as property may nonetheless be subject to transfer taxation, which often comes as a surprise to advisors and an even bigger surprise to clients and their heirs who have to pay a transfer tax on what they consider to be a phantom asset. History Lesson:  The first time […]

Take-Away: A recent decision by the Alaska Supreme Court, Toni 1 Trust vs. Wacker, 2018 WL 1125033 (Alaska, March 2, 2018),  created some  anxiety with regard to the viability of self-settled asset protection trusts, much like Michigan’s Qualified Dispositions in Trust Act. This court decision may not be the death-knell to asset protection trusts as […]