[WSBAPT] IRA beneficiary with restrictions

[Diane J. Kiepe]

Ann,

While I have not encountered this problem, I believe there is no way that you can bind how the distribution will be used.  All the Personal Representative has authority over non probate assets that come into his/her possession.  The note below states that the charities were named directly.   Furthermore, while we all know are clients would never do anything wrong  (😉), you are asking them to go off a written record based on a conversation they cannot confirm.  This is not fair to ask, in my opinion.  You could see that if it were allowed, a rouge PR may substitute their judgement for the decedents.

I might consider a letter, in writing, from the PR, saying what the intention/hopes of the funds were, based on a conversation with the decedent, as follows: (insert information).  Then you may add some language indicating the charity was specifically chosen and it would be a shame if a contribution was not used, at least in part, in a way the was consistent with the decedent’s wishes.

Good luck.


Diane J. Kiepe
Douglas Eden, P.S.
717 W. Sprague Ave., Suite 1500
Spokane, WA  99201
djkiepe at depdslaw.com<mailto:djkiepe at depdslaw.com>
509-455-5300

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From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Anna Van Pelt
Sent: Wednesday, January 31, 2024 2:33 PM
To: WSBA Probate & Trust Listserv <WSBAPT at lists.wsbarppt.com>
Subject: [WSBAPT] IRA beneficiary with restrictions

Good afternoon,

I would love your thoughts on this scenario.

Decedent designated several charities as beneficiaries of her IRA, and then gave oral instructions to her PR about how those funds should be restricted (for example, to be used as an endowment for scholarships for women). The only written record of the restrictions is the PR's notes. While funds have not yet been distributed, at least one charity has been, shall we say, less than enthusiastic about the restrictions coming from the PR's notes from the conversations with the decedent. Can the PR enforce the restrictions that they received orally from the decedent on the charities as a condition of receiving the funds, or are the restrictions unenforceable because they are not included in the beneficiary designation?

Thanks,
Anna


Van Pelt Law
(206) 635-7250
www.vanpeltlegal.com<http://www.vanpeltlegal.com/>

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