Individual Retirement Account (IRA) Planning

Our experienced Individual Retirement Account (IRA) planning attorneys at the Dobson Law Group provides a broad range of estate planning services including Individual Retirement Account planning to individuals, families, business owners and their beneficiaries in Greenville and throughout the of South Carolina, North Carolina, Georgia, and Florida.  Don’t go it alone.  The tax laws surrounding Individual Retirement Accounts are complex and may have current and multi-generational tax implications.   Our experienced IRA planning lawyers will assist you with the design and implementation of an advantageous Estate Plan and IRA strategy that protects your retirement investment for future generations and minimizes the tax implications to your heirs.

” We earn client trust and confidence because we understand that total commitment to quality legal service is the core value in all legal representation.”

IRA Planning & Importance of IRA Beneficiary Designations

Our IRA planning lawyer will assist you in determining the correct beneficiary strategy specific to your individual and financial situation.  An IRA beneficiary is and individual or an entity, such as a charity or trust, chosen by an individual retirement account / IRA owner to receive the IRA assets following the account owner’s death.  It is vitally important that the beneficiary designations and allocations are determined properly that will ensure:

  • IRA assets pass to beneficiaries according to plan;
  • IRA assets avoid probate delay and expense;
  • IRA beneficiaries are provided the opportunity to extend, or “stretch” the tax-deferred earning period of the IRA assets.

Beneficiary Selection

Our IRA Planning attorney can provide you with the guidance and counsel on critically important estate planning questions to consider when designating beneficiaries, including:

Who do you want to inherit your individual retirement account / IRA assets?

  • Spouse, children, grandchildren, charities, trusts

How do you want the beneficiary to receive the assets? Directly or through a trust?
Naming a trust as beneficiary can help you accomplish special goals, such as:

  • Providing lifetime income to a spouse, with assets ultimately passing to children from a prior marriage.
  • Designating a custodian to manage assets for a child with special needs.
  • Making charitable gifts while gaining tax benefits.

What are the tax implications and distribution options for you and the beneficiary with each beneficiary strategy?

Beneficiary Designations

IRA account owners may designate a primary beneficiary and may also choose to designate a contingent beneficiary.  We can assist you in determining and specifying how your assets pass to primary and contingent beneficiaries including the following designations:

  • Single Beneficiary: Assets are distributable to one living beneficiary.
  • Multiple Beneficiaries: Assets are distributable to more than one living beneficiary, with either dollar amounts or percentages to each specified.
  • Custom Beneficiary: If you have specific wishes about how your assets should transfer, you may need to make a custom beneficiary designation. With a custom designation, you can describe your wishes on the beneficiary form in your own words or with an attorney’s assistance. Some examples of a custom beneficiary include:
  • All My Children: Leave your assets to each of your surviving children equally, including any children born or adopted after you execute your beneficiary designation. Descendants of your deceased children do not receive a share of the assets.
    • My Descendants Per Stirpes: Leave your assets to your surviving children and, if applicable, certain surviving descendants of your deceased children. Each of your surviving children and lines of descendants of your deceased children with surviving individuals are allocated equal amounts. Amounts allocated to lines of descendants are divided equally among the individuals in the oldest generation and, if applicable, allocated to surviving descendants of deceased members.
    • My Descendants Per Capita: Leave your assets in equal amounts to your surviving children and surviving individuals in the oldest generation of each line of descendants of your deceased children.
    • Trust: Leave your assets to a trust you have established to be controlled by the trustee for the beneficiaries named in the trust. For example, a trust might benefit your spouse for his or her lifetime, with amounts remaining after your spouse’s death going to your children.
    • Charity: Leave your assets to a tax-exempt religious, educational, scientific or charitable organization.

The beneficiary designation should be considered as part of a comprehensive estate planning strategy, recommended and implemented by an experienced estate planning attorney and IRA planning attorney.  We encourage you to contact us today to discuss your options and requirements at (864)271-8171 or online to schedule an initial consultation.

Stretch IRA Strategy and Required Minimum Distribution

A stretch IRA is a distribution strategy extends the tax-deferred status of individual retirement account / IRA assets across multiple generations.  The stretch strategy is an effective estate-planning tool for individuals that may not require all the assets in the IRA to cover retirement expenses by extending the time period during which the IRA assets have the potential to grow tax-deferred.

Stretch Strategy for Traditional IRA

By naming your spouse as the beneficiary of your traditional IRA, they are permitted to roll the balance into their own traditional IRA when you die and then designate a younger beneficiary.

Your spouse then may take required minimum distributions (RMDs) over their life expectancy. If your spouse is under age 70½ when you die, they may postpone taking RMDs until they reach age 70½.  When your spouse dies, then the second-generation beneficiary may transfer the assets to an inherited IRA and begin taking RMDs over his or her own life expectancy.  This is called an inherited IRA as it holds only assets that are inherited.

Alternatively, you may designate a younger non-spouse beneficiary who can then has the option to transfer the assets to an inherited IRA and take RMDs over their life expectancy after you die.

Stretch Strategy for Roth IRA

The Roth IRA stretch strategy is similar to the Traditional IRA stretch strategy.  By naming your spouse as the beneficiary of your Roth IRA, they are permitted to roll the balance into their own Roth IRA when you die and then designate a younger beneficiary.  However, with a Roth IRA stretch strategy, your spouse is not required to take RMDs.  The result is assets may continue in their tax-deferred status longer than in stretch traditional IRA.  When your spouse dies, then the second-generation beneficiary must begin taking RMDs over his or her own life expectancy.  Distributions from a Roth IRA, however, if qualified, will be tax-free.

The tax law governing the IRA stretch strategy for individual retirement accounts and employer-sponsored retirement plans (401k) contains complicated guidelines, limitations, and requirements.  Protect your IRA assets for future generations.  Consult the experienced tax attorney or IRA planning at the Dobson Law Group to discuss your options.

Consult a South Carolina Individual Retirement IRA Planning Attorney in Greenville.

Our experienced and knowledgeable Individual Retirement Account IRA planning attorney can provide you the information, guidance and assistance to make an appropriate decision regarding these important estate planning strategies and:

  • Evaluate your income sources as part of an overall estate plan, distribution strategies and tax implications
  • Evaluate a stretch IRA in the context of your overall wealth management strategy.
  • Assist you with your beneficiary designations, including custom designations (trusts) and other specific beneficiary arrangements.

We encourage you to contact an experienced Estate Planning lawyer at the Dobson Law Group to discuss your options and requirements at (864)271-8171 or online to schedule an initial consultation.

The Dobson Law Group provides Tax Planning & Postmortem Tax Planning attorney legal services to clients in Greenville County and throughout South Carolina including Abbeville, Anderson, Cherokee, Greenwood, Laurens, Lexington, Newberry, Oconee, Pickens, Richland, Spartanburg, and Union County. We are licensed in South Carolina, North Carolina, Florida, and Georgia.