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<p class="MsoNormal"><span style="color:#1F497D">To elaborate on Diane’s post, I suggest you ask for a copy of the custodial agreement or the plan, whichever one has the default clause. It will explain the default beneficiary. Don’t look for a set of internal
rules or an internal policy; look to the contract.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">I saw a study once that contacted a variety of IRA custodians. The default clauses varied from custodian to custodian. Some went to spouse. Some went to estate. Some went to a third place that I cannot remember.
But I do recall that the contracts were somewhat evenly divided 33/33/33 among the three different destinations. Call your custodian.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">Phil Jones<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">Portland, OR<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b>From:</b> wsbapt-bounces@lists.wsbarppt.com <wsbapt-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>Diane J. Kiepe<br>
<b>Sent:</b> Monday, November 04, 2019 9:15 AM<br>
<b>To:</b> WSBA Probate & Trust Listserv <wsbapt@lists.wsbarppt.com><br>
<b>Subject:</b> Re: [WSBAPT] Default Beneficiary of IRA<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Michael,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Yes – an IRA is a contract and the default beneficiaries of the plan typically govern. The no beneficiary is if there is truly “no beneficiary”. Here is this – it is by contract.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Best,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><i><span style="font-family:"Script MT Bold"">Diane J. Kiepe<o:p></o:p></span></i></p>
<p class="MsoNormal"><i><span style="font-family:"Script MT Bold""><o:p> </o:p></span></i></p>
<p class="MsoNormal">Diane J. Kiepe<o:p></o:p></p>
<p class="MsoNormal">Douglas Eden<o:p></o:p></p>
<p class="MsoNormal">717 W. Sprague Ave.<o:p></o:p></p>
<p class="MsoNormal">Suite 1500<o:p></o:p></p>
<p class="MsoNormal">Spokane, WA 99201<o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:djkiepe@depdslaw.com"><span style="color:#0563C1">djkiepe@depdslaw.com</span></a><o:p></o:p></p>
<p class="MsoNormal">509-455-5300<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbapt-bounces@lists.wsbarppt.com">
wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Michael Geoghegan<br>
<b>Sent:</b> Monday, November 4, 2019 8:48 AM<br>
<b>To:</b> <a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a><br>
<b>Subject:</b> [WSBAPT] Default Beneficiary of IRA<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">Hi All,<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">Here's my question: <o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">Where <span style="background:white">
the Primary Beneficiary of an IRA does not survive the decedent, </span>can the company managing the IRA use defaults to determined the contingent beneficiary or must the IRA revert to an "Inherited IRA in the name of the Estate"?<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">I am working on an estate where the decedent did not properly name contingent beneficiaries to his tax deferred retirement accounts.<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">Decedent left an IRA with just shy of $1M. Primary beneficiary is the testamentary "Marital Trust," established l only if spouse survives him. Spouse did not survive him so the Marital Trust does
not exist.<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">There is no Contingent Beneficiary named to receive the IRA. <o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">I consulted Natalie Choate's book and determined that the the IRA account should be treated as "No Beneficiary" and default to an Inherited IRA in the name of the Estate. <o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">Today I learned that the custodian of the IRA account has its own internal default rules if Primary Beneficiary is not available to inherit the IRA -- 100% to spouse or 100% divided among then-living
children if spouse is not alive. This is not in line with the inheritance scheme of decedent's estate. Is there a legal basis for such a policy? <o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black;background:white">(The after the Marital Trust, the will establishes a "Family Trust" to manage tax deferred retirement funds, RMDs to be split 5 ways. I infer the intent of the Family Trust was
to prevent decedent's only child from immediately cashing out an Inherited IRA.)</span><span style="font-size:12.0pt;color:black"><o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black">-Michael<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;color:black"><o:p> </o:p></span></p>
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<p style="background:white"><span style="font-size:10.0pt;color:black">Michael Geoghegan<br>
Northwest Strategy and Planning, PLLC<br>
t: 206.353.5592<br>
e: <a href="mailto:michael@nwstrategyandplanning.com">michael@nwstrategyandplanning.com</a></span><span style="color:black"><o:p></o:p></span></p>
<p style="background:white"><span style="font-size:10.0pt;color:black">w: <a href="http://nwstrategyandplanning.com">
<span style="color:#006FC9">nwstrategyandplanning.com</span></a> | <a href="https://www.linkedin.com/in/michael-geoghegan-5893407" title="Cmd+Click or tap to follow the link">
<span style="color:#006FC9">LinkedIN</span></a></span><span style="color:black"><o:p></o:p></span></p>
<p style="background:white"><span style="font-size:10.0pt;color:black">Scheduling: <a href="https://northwest-strategy-and-planning-pllc.appointlet.com"><span style="color:#006FC9">https://northwest-strategy-and-planning-pllc.appointlet.com</span></a></span><span style="color:black"><o:p></o:p></span></p>
<p style="background:white"><span style="color:black"><o:p> </o:p></span></p>
<p style="background:white"><span style="color:black"><img border="0" width="200" height="64" style="width:2.0833in;height:.6666in" id="_x0000_i1025" src="cid:image001.png@01D592FA.0C5D5460" alt="1455905947881_NWStrategyPlanningLogo_email.png"><o:p></o:p></span></p>
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