Supreme Court Ruling Could Affect Your IRA

The Wall Street Journal published a story in October titled, “Court Ruling Sparks Rush to Shield IRAs.” The article goes into depth about a June 2014 decision by the courts that ruled an inherited IRA is not considered a retirement account. Their decision hinged on the fact that a beneficiary can withdraw funds from the account at any time without penalty. The result of this decision means that any inherited IRA funds will no longer be protected from creditors if the beneficiary must file for bankruptcy.

As a result of this decision, many are asking what they can do to protect their IRAs so that future generations can utilize the funds, even if they find themselves in bankruptcy later in life.

We have heard the same concerns from our clients, and there is good news. By establishing a trust as the beneficiary of your IRA there is the opportunity to protect those retirement assets while still providing access to the money while you are alive.

The article says, “The challenge is identifying and employing the right kind of trust, which can be difficult given the complexity of the issue.”

That is where Vanguard Legal Group comes in. Our experienced estate planning attorneys will work with you to identify areas of concern. We can outline the best plan to protect your assets, including your IRA, in the future.


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