Individual Retirement Account IRA: Inherited IRA

In many cases, the largest asset that an individual accumulates during their lifetime is a retirement plan account or IRA. This may be the largest or only asset available to pass on to future generations. Unfortunately, improper planning can quickly deplete the value of retirement plan and IRA assets, as income taxes can take their toll. 

The inherited/stretch IRA planning strategy can increase the net amount to clients’ heirs, and help them achieve their financial goals. By structuring a traditional or Roth IRA properly at the IRA owner’s death, a beneficiary can establish an inherited/stretch IRA by keeping the IRA in the deceased owner’s name potentially for the beneficiary’s lifetime. After the IRA owner’s death, beneficiaries must receive a minimum distribution from the inherited/stretch IRA every year, which creates an annual legacy in your client’s name. 

However, a beneficiary generally has the ability to take more than the minimum distribution amount at any time. The remaining balance of the Inherited/stretch IRA retains its tax-deferred status, therefore, income taxes are not due until each payment is received.

Questions?   Contact us www.MintcoFinancial.com