Seymour Goldberg is the senior partner in the law firm of Goldberg & Goldberg, P.C., Long Island, New York, is Professor Emeritus of Accounting, Law and Taxation at Long Island University.  He has taught many CLE and CPE programs at the state and national level as well as CLE courses for the American Bar Association, New York State Bar Association, City Bar Center for Continuing Legal Education, NJICLE, local bar associations and law schools.  Mr. Goldberg has been quoted in major publications including the New York Times, Forbes and the Wall Street Journal.  He was formerly associated with the Internal Revenue Service and has been involved in conducting continuing education outreach programs with the IRS.  He has authored guides for the American Bar Association and the American Institute of Certified Public Accountants on IRA compliance issues.  Mr. Goldberg is the recipient of Outstanding Discussion Leader Awards from both the AICPA and the Foundation for Accounting Education.  His IRA guides can be found in well over 100 law school libraries.

Description of this guide

Many taxpayers have accumulated a considerable amount of assets in their retirement accounts.  These assets may be in their 401(k), another type of qualified plan, a 403(b) arrangement, a 457 governmental plan, a traditional IRA and a Roth IRA.  Retirement type assets are often the largest asset that a client may have in his/her estate.

The problem with the concept of estate planning with retirement assets is the fact that many people fail to address this issue during their lifetime.  Often the taxpayer relies upon an advisor who may not know many of the rules.

The purpose of this guide is to alert you, as a practitioner, as to many of the rules that you must know in order to effectively implement an estate plan that includes a trust as a beneficiary of retirement-type assets.  These rules are important and you need to be aware of them.

Some topics included in this guide include:

  • Advantages of Trusts as IRA Beneficiary

o    Disadvantages of Trusts as IRA Beneficiary

o    IRA Trust Checklist

o     IRA Trust Instructions

o     Customized Sample Beneficiary Forms

o     IRAs and Prohibited Transactions

o     DOL Advisory Opinion 2009-02A

o    Compensation of Trustee

  • Non-Compliant Trusts and Circular 230 Issues

o     Statute of Limitation Issues Involving IRA Penalties

o     Internal Revenue Manual (IRM) Discusses the Statute of Limitations for Form 5329

o     An Important IRA Distribution “Tax Trap”

o     Creditor Rights and Inherited IRAs Under State Law

  • And much more

Can You Answer These Questions?

  1. If an IRA owner designates a trust as the beneficiary of his/her IRA, then must certain paperwork be filed with the IRA institution after the IRA owner’s death for stretch payment purposes?
  2. If the answer to Question 1 is yes, by what date must such paperwork be filed?
  3. Should a customized beneficiary form be used when an IRA owner designates a trust as the beneficiary of his/her IRA?
  4. Should the word “income” be used in a non QTIP IRA trust?
  5. Is a required minimum distribution considered to be “income” under the state trust law definition of “income”.
  6. If an IRA owner dies before receiving his/her entire required minimum distribution for the year of his/her death, then what IRS rules apply?
  7. If the trustee of an IRA trust receives excessive fees from the trust, is he or she subject to a prohibited transaction tax sanction?
  8. If an IRA trust is receiving required minimum distributions over an incorrect excessive period (non-compliant trust), then what are the tax sanctions that can be asserted against the trust, the trustee and the trust beneficiaries?
  9. What IRS Form should the trustee file with the IRS to attempt to obtain a waiver of the tax sanctions referred to in Question 8 above?

Is the beneficiary of an inherited IRA protected from his/her creditors under state law ?