Legal Blog
The Weekly Scenario: “As Per Will”
Question: My wife passed away and her IRA beneficiary designation read “As Per Will.” How will the IRA custodian interpret this language?
Answer: “As Per Will” means the estate is the beneficiary. Because she did not name a designated beneficiary (a living person), the IRA funds would need to be transferred to an inherited IRA for the benefit of the estate.
Comment: This seems pretty straightforward, but to take this another step, the question for many people is what if her husband (who is the beneficiary under her Will) tries to roll over the IRA into his own name? Would he be permitted to do this? There are tax advantages for a spouse who can roll over the IRA into his own plan.
The first thing he would need to do is take a distribution from the estate IRA since he is the sole beneficiary of the estate. Next, he could then roll over that amount within 60 days into an IRA in his own name.
According to guidance I found from the IRS, the husband should be permitted to roll over the distribution to his own IRA within 60 days. In other words, he should be treated as having received the funds directly from his late wife’s IRA, and thus allowed do the spousal rollover.
As always, if you have any questions or would like to learn more, please contact Steve Shane at sshane@offitkurman.com or .
ABOUT STEVE SHANE
Steve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates.
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