Estate Planning Attorney Michael Gilfix Explains Inherited IRA Protection in Light Of Supreme Court Decision
Nov 18, 2014
Palo Alto, CA (Law Firm Newswire) November 18, 2014 – Earlier this year, the Supreme Court of the United States reaffirmed that inherited IRA accounts are not protected in bankruptcy as regular retirement accounts are.
According to estate planning attorney Michael Gilfix of Gilfix & La Poll, this is just one of the many reasons that anyone with a significant IRA account should look into the idea of setting up a trust as the beneficiary of an IRA account.
“Designating a trust for an IRA account is not for everyone,” Gilfix explained, “but it could be of great benefit to families with small children or with special needs family members and for anyone who simply wants to ensure that the money is protected.”
In the Supreme Court case, Heidi Heffron-Clark inherited an IRA account from her mother and declared bankruptcy several years later. Her attorneys tried to claim that creditors could not access the money in the IRA because it was a retirement account, but the Supreme Court disagreed, saying that inherited IRAs are fundamentally different.
According to an article in Forbes, a properly structured trust can still allow beneficiaries to stretch out the tax benefits of an IRA account over more years, as they might do with the account if they inherited it directly.
Gilfix pointed out that individuals should consult a financial planner and an attorney before making a decision. “Most people fill in a beneficiary name on a form when they open the IRA account, and they do not give much more thought to it,” said Gilfix. “This recent Supreme Court decision is a reminder that there are many good reasons to put more thought into how an IRA would be handled as part of an inheritance.”
The Supreme Court case is Clark vs. Rameker, Trustee, et al., case number 13-299.
Gilfix & La Poll Associates LLP
2300 Geng Rd., Suite 200
Palo Alto, CA 94303
Telephone: (650) 493-8070
http://www.gilfix.com/
Facebook: Like Us!
- Computer-based messaging may help individuals with autism develop better relationships
The MIT publication Technology Review recently called attention to a new study that takes a novel approach to computer use for people with autism. Traditionally, people with autism are thought to be loners who do not desire social connection. Many of the computer-based interventions for people with autism have sought to enhance communication skills that […] - Planning for the future: ideas and technologies for aging in place
By Mark Gilfix As more Baby Boomers reach their senior years, more policymakers and elder health advocates are turning their attention to the issues behind aging in place. Overwhelmingly, research shows that older Americans would prefer to age at home or in other noninstitutional settings. But for aging in place to really work, a number […] - Thank you to all attendees of our very successful seminars
Gilfix and La Poll associates would like to thank the attendees of our very successful seminars about estate planning and long term care in Palo Alto on October 14th. Our audiences were large and highly engaged, and they asked great questions. We are hopeful and confident that they got highly valuable information that will serve […] - For a second or third marriage, make estate planning part of wedding planning
When daily discussions revolve around flowers, music and cake, it may seem unromantic to bring up estate planning. But if you consider renewed estate planning as a way for you and your future spouse to bring old estate plans into harmony with your new hopes for your future family, it can seem a lot more […] - Two new studies of Alzheimer’s disease deliver promising results
Two new studies show progress toward producing a cure for Alzheimer’s disease and discovering its causes. A new study from the Yale School of Medicine has announced a major step forward in the push to find a drug to treat Alzheimer’s disease. Yale researchers have created a drug that reverses cognitive defects caused by Alzheimer’s […]
