Common Errors In Retirement Distribution Planning

• Author: Seymour Goldberg
• Profession: Senior partner in the law firm of Goldberg & Goldberg, P.C., Woodbury, New York
• Pages: 2-4

2

COMMON ERRORS

IN RETIREMENT

DISTRIBUTION

PLANNING

In general the following common errors often take place when dealing

with the retirement distribution rules from an estate planning point of

view:

• Failure to timely update and / or review your existing beneficiary

forms on file with the IRA institution and the employer sponsored

retirement plan.

• Failure to periodically review your existing legal instruments to de-

termine whether the retirement assets are charged with an allocable

portion of the estate tax upon your death or are exonerated from

the estate tax liability allocable to the retirement assets. If exoner-

ated, then make sure that there are sufficient other assets to pay the

estate tax allocable to the retirement assets.

• Exonerating the retirement assets from any estate tax liability will

permit more tax- deferred growth of the retirement assets and tax-

free growth of Roth IRAs. However, this exoneration approach is

at the expense of other beneficiaries of the estate.

• Failure to do an estimated estate tax liquidity analysis to determine

the extent of your estate tax liability and the source of payment of

the estate tax liability.

• Failure of your beneficiaries to know how the inherited IRA distri-

bution rules work after your death.

• Failure of your surviving spouse to know about the spousal rollover

rules or direct transfer rules after your death.

• Failure of your surviving spouse to timely implement the spousal

rollover rules or direct transfer rules after your death.