When Your Clients Lives Change, Be Sure Their Life Insurance Beneficiary Designations Keep Up

Size: px
Start display at page:

Download "When Your Clients Lives Change, Be Sure Their Life Insurance Beneficiary Designations Keep Up"

Transcription

1 Thus+ Counselor s Corner When Your Clients Lives Change, Be Sure Their Life Insurance Beneficiary Designations Keep Up Situation: One of the most important decisions the owner of a life insurance policy makes is deciding who to name as the beneficiary. On the surface a beneficiary designation may seem simple and straightforward, but they have the potential to be complex. Unfortunately, many people do not put much thought into the identification of a beneficiary when setting up their life insurance policies even though some of the most common errors are made with respect to the naming of beneficiaries. While this error can cause unnecessary taxes, the most serious result of this mistake is that the death benefit proceeds may pass to unintended individuals. Beneficiary designations should be considered carefully and reviewed regularly. Consequently, when performing a policy review, in addition to reviewing the performance and market competitiveness of the policy you should also review errors in beneficiary designations. This Counselor s Corner includes a discussion of three situations that may arise in life insurance policy designations that create tax problems. In addition, we have attached a checklist to help you in your review of beneficiary designations as well as a guide on drafting life insurance beneficiary designations. Solution: There are several tax considerations that can arise when establishing or changing a beneficiary designation. Following are three of the most commonly occurring situations and suggestions for correction: Making a Taxable Gift by Having Three Different Parties on a Policy: The Goodman Rule. The most common error I see is where the policy owner unknowingly makes a large taxable gift of the death benefit because of poor beneficiary planning. This can occur when the policy owner, insured, and a named beneficiary are all different people or entities. For example, this unintended tax can occur when a parent is an insured, the spouse is owner, and children are beneficiaries. In this situation, at the death of the parent the spouse/policy owner will be deemed to have made a taxable gift to the children. This result can be avoided by making sure the policy owner is either the insured or the beneficiary. The same type of error can occur in the business situation, but with a different tax result. Periodically, I see a policy structured where the business is the policy owner, the insured is an employee/business owner and the spouse/family as beneficiary(s). In this situation, at the death of the insured the death proceeds received by the spouse/family are likely to be considered income taxable compensation or business distribution. Having a Policy Death Benefit Become Taxable Income by Violating the Transfer-for-Value Rule. When an insured dies, policy death proceeds are generally received by the beneficiaries income tax-free under IRC 101. However, this income tax exclusion can be lost if prior to the insured s death the policy owner transferred an interest in the policy to someone else and received valuable consideration in exchange. Many financial advisors are aware that the sale of a policy and change of ownership pursuant to a life settlement causes the proceeds to be subject to income tax. Likewise, many advisors are aware that a change of policy ownership from a corporation to a co-shareholder pursuant to the funding of a cross-purchase buy-sell agreement also triggers the rules application. Unfortunately, many advisors are not aware that a change in beneficiary designations can also cause

2 the proceeds to be subject to income tax. Fortunately, there are several exceptions to the rule. For example, a transfer to: the insured, or a partner of the insured; a partnership where the insured is a partner; a corporation where the insured is an officer or shareholder transfer where the cost basis of the policy carries over from the transferor to the transferee Because the consequences for violating this rule do not apply until the insured s death, it may be possible to cure the violation while the insured is alive by retransferring the policy to one of the recognized exceptions. Causing the Death Benefit to Become Taxable by Violating the Employer Owned Life Insurance (Section 101(j)) Rule. For policies issued after August 17, 2006, where the business is owner and beneficiary and the insured an employee at the time of policy issue, the death benefit is taxed as ordinary income to the extent the amounts paid under the contract exceed premiums and other amounts paid by the employer. However, death proceed is not taxed under this provision where the following two conditions are met: employer satisfies certain notice and consent requirements prior to policy issue and certain safe harbor exceptions apply. Unfortunately, the notice and consent disclosure requirements are often missed at policy issue because they are not an insurance company requirement and many companies do not provide forms as part of the application process. Like the transfer-for-value rule, since this rule does not apply until the insured s death, it may be possible to cure the oversight while the insured is alive by executing a notice and consent prior to issue of a new policy. Of course, this means the insured must be able qualify for new insurance coverage. Of all the errors that occur with life insurance beneficiary designations, the one that occurs with the greatest frequency is the failure to regularly review beneficiary designations. Unfortunately, after the purchase of a policy many people put the whole thing out of mind. The policy is locked-up, along with other important papers, and not looked at again until the time to file a death claim. To the great surprise of many, an ex-spouse or deceased individual may be the beneficiary. The solution to this problem is easy.... make sure you regularly help your clients review their beneficiary designations. Changing a beneficiary designation is very simple, but before you proceed with the change you need to make sure you will not create an unintended tax problem in the process. This material has been prepared to assist our licensed financial professionals and clients advisors. It is designed to provide general information in regard to the subject matter covered. It should be used with the understanding that we are not rendering legal, accounting or tax advice. Such services must be provided by the client s own advisors. Accordingly, any information in this document cannot be used by any taxpayer for purposes of avoiding penalties under the Internal Revenue Code. Insurance policies contain exclusions, limitations, reductions of benefits and terms for keeping them in force. Policies and or features may not be available in all states. Securities and Insurance Products: Not Insured by FDIC or Any Federal Government Agency. May Lose Value. Not a Deposit of or Guaranteed by Any Bank or Bank Affiliate Diversified Brokerage Services, Inc Excelsior Blvd., Minneapolis, MN

3 Life Insurance Diversified Brokerage Services, Inc. Beneficiary Designation Checklist The below questions are designed to help the financial advisor identify some of the frequently encountered areas where beneficiary designations can create problems. This checklist of questions and supporting discussion points can be used when establishing beneficiary designations in the original application as well as when reviewing an existing policy designation. Are the Beneficiary Designations Clear? Is each primary beneficiary clearly identified? If the policy owner wants the death benefit to be divided other than equally has the beneficiary s percentage interest been included and do all the beneficial interests add up to 100%? If there are multiple individual beneficiaries and one or more of the beneficiaries dies before the insured does the policy owner want the remaining surviving beneficiaries to divide the proceeds equally? (beneficial interest is joint with right of survivorship) If no, has language been used to distribute death proceeds as tenants-incommon? Are contingent beneficiary(ies) clearly identified? Are Any of the Beneficiaries Minors? If yes, is the beneficiary designation structured as a minor trust or custodian under UTMA (Uniform Transfer to Minors Account)? If no, death benefits will not be paid directly to minors. Instead, payment is made to someone appointed by the court to be the minor s guardian/ custodian. Does the Policy Owner Live in a Community Property State? If yes, is the spouse the beneficiary of more than 50% of the policy death benefit? If no, has the spouse given written consent or is the premium paid with policy owner s separate property funds? If no, the spouse will be considered to have made a gift to the nonspouse beneficiary(ies). Are Different People/Entities Named as Insured, Policy Owner (s) and Beneficiary(ies)? If yes, where the policy owner is an individual at the insured s death s/he will be considered to have made a gift to the beneficiary(ies). If yes, where the policy owner is a business entity at the insured s death there is a risk that the death proceeds may be taxable as income. Is a Business a Beneficiary and Policy Owner? If yes, is the insured an appropriate insured under Internal Revenue Section

4 Business insurance Beneficiary Designation Checklist 101(j)? (An employee at any time during the 12-month period before the insured s death, or a director, a highly compensated employee, or a highly compensated individual at the time the contract was issued.) If yes, has the notice and consent requirements been met before policy was issued? If no, the death proceed in excess of cumulative premium payment will be subject to income tax. After the Initial Purchase of the Policy Did the Policy Owner Receive Anything of Value in Exchange for Changing the Beneficiary or Owner? If yes, was the transfer to an exempt transferee under Internal Revenue Code Section 101(a)(2)(A) and (B)? (Transfer to the insured, a partner of the insured, a partnership in which the insured is a partner, a corporation in which the insured is an officer or shareholder, or a transfer where the transferee s basis in the policy is determined in whole or part by reference to the basis of the transferor) If no, the death benefit will be subject to income tax at the insured s death unless the policy is retransferred to an except transferee. On an Existing Policy Does the Beneficiary Designation Still Accomplish the Owner s Objectives? Has the beneficiary designation been reviewed recently? Is the reason for having the life insurance the same as when you purchased the policy? Has the number of desired beneficiaries remained the same? (Example: Number of children increased since purchasing the policy) Is your marital status the same as when you purchased your policy? Are your beneficiaries abilities to manage their financial affairs the same as when you purchase your policy? Has the passage of time or the occurrence of events not anticipated when the policy was purchased caused the beneficiary designation to be outdated? This material is designed to provide general information in regard to the subject matter covered. It should be used with the understanding that we are not rendering legal, accounting or tax advice. Such services should be provided by your own advisors. Accordingly, any information in this document cannot be used by any taxpayer for purposes of avoiding penalties under the Internal Revenue Code. Life insurance policies contain exclusions, limitations, reduction of benefits and terms for keeping them in force. Your licensed financial professional will provide you with costs and complete details. Securities and Insurance Products: Not Insured by FDIC or Any Federal Government Agency. May Lose Value. Not a Deposit of or Guaranteed by Any Bank or Bank Affiliate Diversified Brokerage Services, Inc Excelsior Blvd., Minneapolis, MN

5 Beneficiary Designation Guidelines One of the most important decisions the owner of a life insurance policy makes is deciding who to name as the beneficiary. Beneficiary designations should be considered carefully and reviewed regularly. We have developed this guideline to help you save time and avoid delays. The examples below are suggestions only; each carrier will have their own particular guidelines. Please note that carriers are asking more detailed information about the beneficiary such as address and social security number in an attempt to better identify and track beneficiaries. We understand that some clients may object to such inquiry; but recent litigation against some life insurance carriers for not paying death benefit when a claim is not filed because the beneficiary is not aware there is a policy has caused carriers to ask for more information to be in a better position to find beneficiary(ies) of a known deceased insured. Beneficiary(ies) Language/ Guidelines Comments Estate of the Insured Spouse of Insured Minor Child/ Beneficiary Multiple Adult Children/ Beneficiaries (If a beneficiary dies before the insured proceeds pass equally to the surviving beneficiaries) Estate of (full name) Insured. Only use in very rare situation because the designation will cause the proceeds to be subject to creditors. Where it s used we strongly suggested that the financial advisor document their case file that they advised the insured against/drawbacks to the designation. (Full name of spouse) spouse of the insured. Social security number See Testamentary Trust where proceeds are paid to trust for the minor s benefit. Uniform Transfers to Minors Act (UTMA): (Full name of custodian) as Custodian for (full name of child) son/daughter, under the (State) Uniform Transfers to Minors Act. Provide the following information: Full name of each beneficiary Relationship to the insured Date(s) of birth for each child Social security number for each child Current addresses of each child If the beneficiary is a minor at the insured s death, the death benefits will not be paid direct to the minor. Instead, payment is made to someone appointed by the court to be the minor s guardian/custodian. Instead of the expense and complexity of a court appointed custodian, a trustee of a trust for the minor s benefit, or a custodian under the state s UTMA can be used. The insured should normally be the policy owner where there are multiple beneficiaries. Having three different designations on a policy can cause adverse gift tax (e.g., having a parent as the insured, one child as owner, and multiple children as beneficiaries). While it s possible to have the same owners and beneficiaries, where there are multiple owners any policy action will require the consent of all owners. Where there are multiple beneficiaries proceeds are distributed to the surviving named beneficiaries in equal shares (joint with right of survivorship) except where tenants in common is requested.

6 Multiple Beneficiaries (tenants in common) Trust Under Will (Testamentary Trust) Living Trust Provide the following information: Full name of each beneficiary Percentage (must add up to 100%) Relationship to the insured Date(s) of birth for each beneficiary Social security of each beneficiary Current addresses of each beneficiary (Full name of trustee) as trustee of (full name of the trust if applicable) created in the instrument admitted as my Last Will and Testament provided, should my Last Will and Testament not contain (name of the trust) or should I die intestate, then equally to my then living children (name of children). (Full name of trustee) as trustee of (full name of the trust) dated (date of trust). An example where the desire is to have the death benefit pass to heirs of a beneficiary that predeceases the insured (tenants in common) instead of the surviving beneficiaries: 50% to (name of beneficiary #1), if living, otherwise to the estate of (beneficiary #1); and 50% to (name of beneficiary #2), if living, otherwise to the estate of (beneficiary#2). Avoid using terms per capita, per stirpes, and by representation Avoid using the terms issue, heirs and descendants. This beneficiary designation is often used for trusts established to benefit minor children. Such a trust may not exist at the insured s death so it s important to address this contingency with a successor beneficiary. If the trust is established to keep the policy proceeds out of the estate of the insured(s) the trust should also be the owner. Corporation Partnership Limited Liability Company Charitable Organization Contingent Beneficiary Collateral Assignment (Full name of company) Inc., a (state) corporation. (Full name of company) a (state) partnership. (Full name of company) LLC, a (state) limited liability company. (Full name of charity) a (state) corporation. Way for lender to receive some policy death proceeds while NOT being a beneficiary. It s important to designate contingent beneficiary(ies) especially when the primary beneficiary(ies) are individuals. A separate form where policy owner transfers all or a portion of rights to death proceeds to an assignee/lender with policy beneficiary the balance. This is designed to provide general information in regard to the subject matter covered. It should be used with the understanding that we are not rendering legal, accounting or tax advice. Such services should be provided by your own advisors. Accordingly, any information in this document cannot be used by any taxpayer for purposes of avoiding penalties under the Internal Revenue Code Diversified Brokerage Services, Inc Excelsior Blvd., Minneapolis, MN For the Education of Financial Representatives. Not for use with the General Public.

Life insurance beneficiary designations

Life insurance beneficiary designations ADVANCED MARKETS Life insurance beneficiary designations BECAUSE YOU ASKED When designating a beneficiary of a life insurance policy, the policy owner should consider a multitude of factors, such as the

More information

Counselor s Corner. SLAT: Is It Possible to Have Access to Trust Assets Without Estate Inclusion?

Counselor s Corner. SLAT: Is It Possible to Have Access to Trust Assets Without Estate Inclusion? Counselor s Corner SLAT: Is It Possible to Have Access to Trust Assets Without Estate Inclusion? Situation: Most gift tax exemption estate strategies require assets to be given away with no strings attached.

More information

YOUR GUIDE TO Beneficiary Designations

YOUR GUIDE TO Beneficiary Designations YOUR GUIDE TO Beneficiary Designations 60 Empire Drive Suite 300 St. Paul, MN 55103 Telephone: 651-296-2761 Toll-free: 1-800-657-5757 www.msrs.state.mn.us INTRODUCTION Introduction Beneficiary designations

More information

Counselor s Corner. Caution: A Change in a Buy-Sell Policy Owner or Beneficiary can Result in Income Tax of the Death Proceeds

Counselor s Corner. Caution: A Change in a Buy-Sell Policy Owner or Beneficiary can Result in Income Tax of the Death Proceeds Counselor s Corner Caution: A Change in a Buy-Sell Policy Owner or Beneficiary can Result in Income Tax of the Death Proceeds Situation: One consideration that goes into any discussion of using life insurance

More information

1 Account Holder Information

1 Account Holder Information Transfer on Death (TOD) Application and Agreement 1 Account Holder Information Account Holder(s) Name Social Security Number(s) Account Holder(s) Address City, State Zip You are applying for registration

More information

Credit shelter trusts and portability

Credit shelter trusts and portability Credit shelter trusts and portability Comparing strategies to help manage estate taxes Married couples have two strategies to choose from to help protect their families from estate taxes. Choosing the

More information

Charitable Giving Techniques

Charitable Giving Techniques Charitable Giving Techniques Helping achieve your charitable and estate-planning goals Trust Tip A trust can be thought of as having two parts an income interest and a remainder interest. The income interest

More information

Preserving and Transferring IRA Assets

Preserving and Transferring IRA Assets january 2014 Preserving and Transferring IRA Assets Summary The focus on retirement accounts is shifting. Yes, it s still important to make regular contributions to take advantage of tax-deferred growth

More information

Designating a Beneficiary for Your IRA

Designating a Beneficiary for Your IRA Retirement Planning Designating a Beneficiary for Your IRA You have likely named beneficiaries many times over the years for things like your life insurance policies, annuity contracts, IRAs, company pension

More information

The Unlucky 13: Avoiding the Top 13 Most Common Estate Planning Mistakes

The Unlucky 13: Avoiding the Top 13 Most Common Estate Planning Mistakes The Unlucky 13: Avoiding the Top 13 Most Common Estate Planning Mistakes Janet Nava Bandera, Director Wealth Planning Strategies Individual Advisory Services University of Kentucky Retirement Planning

More information

Preserving and Transferring IRA Assets

Preserving and Transferring IRA Assets Preserving and Transferring IRA Assets september 2017 The focus on retirement accounts is shifting. Yes, it s still important to make regular contributions to take advantage of tax-deferred growth potential,

More information

Transfer on Death Agreement

Transfer on Death Agreement Transfer on Death Agreement Please use this form to designate individual(s) or trust(s) that you would like to receive assets in your Merrill Edge brokerage account upon your death without going through

More information

ESTATE PLANNING AND WILL INFORMATION FORM

ESTATE PLANNING AND WILL INFORMATION FORM Spaniol Building 15 6 th Ave. N. St. Cloud, MN 56303 Telephone: (320) 259-4070 Fax: (320) 259-4061 Betsey Lund Ross, Attorney at Law Betsey@lundrosslaw.com ESTATE PLANNING AND WILL INFORMATION FORM Thank

More information

SIMPLE BACKGROUND INFORMATION

SIMPLE BACKGROUND INFORMATION 1 SIMPLE BACKGROUND INFORMATION The information you provide in this section provides us with important objective information about you, your age, marital status, where you live, and how best to communicate

More information

Strategic Planning for Life and Death

Strategic Planning for Life and Death Claude B. Bass, J.D. Advanced Planning Consultant - Architect Telephone (678) 580-2400 Claude_Bass@Comcast.Net Strategic Planning for Life and Death Rule Number One Beware the Short Form Estate Plan If

More information

REVOCABLE LIVING TRUST

REVOCABLE LIVING TRUST CHERRY CREEK CENTER 4500 CHERRY CREEK DRIVE SOUTH, SUITE 600 DENVER, CO 80246-1500 303.322.8943 WWW.WADEASH.COM CORPORATE DISCLAIMER The federal tax discussions in this memorandum will be affected by any

More information

Understanding Probate

Understanding Probate Understanding Probate Understanding Probate DISCUSSION TOPICS What is Probate? Joint Ownership Avoids Probate Special Considerations of A Will INVEST Trust Services What is Probate? Many people are aware

More information

Preserving and Transferring IRA Assets

Preserving and Transferring IRA Assets AUGUST 2016 Preserving and Transferring IRA Assets SUMMARY The focus on retirement accounts is shifting. Yes, it s still important to make regular contributions to take advantage of tax-deferred growth

More information

An employee guide to Group

An employee guide to Group A legacy of caring An employee guide to Group Life beneficiary designations and assignments. While not always top of mind, making sure that death benefits are directed to the intended beneficiary(ies)

More information

Group Benefits. A legacy of caring. Employee s guide to Group Life beneficiary designations and assignments

Group Benefits. A legacy of caring. Employee s guide to Group Life beneficiary designations and assignments Group Benefits A legacy of caring Employee s guide to Group Life beneficiary designations and assignments An employee guide to designating beneficiaries While not always top of mind, making sure that death

More information

GLOSSARY. Compiled by Carolyn Paseneaux

GLOSSARY. Compiled by Carolyn Paseneaux GLOSSARY Compiled by Carolyn Paseneaux AB TRUST A trust giving a surviving spouse or mate a life estate interest in property of a deceased spouse or mate. It is used to save eventual taxes on the estate.

More information

The importance of assistance

The importance of assistance TRANSFERRING Estate Planning Guide for Ontario Resident The importance of assistance Table of contents Creating Your Legacy.... 02 Steps in Setting Up an Estate Plan.... 02 1. Gather Your Information............................................

More information

If you would like you can also add a picture of the church or church activity of your choice.

If you would like you can also add a picture of the church or church activity of your choice. Please enter the name of your church and location on this page. If you would like you can also add a picture of the church or church activity of your choice. 1 2 Many people have not really thought about

More information

Q&A Advanced Markets Edition. Allianz Life Insurance Company of North America Allianz Life Insurance Company of New York

Q&A Advanced Markets Edition. Allianz Life Insurance Company of North America Allianz Life Insurance Company of New York Q&A Advanced Markets 2017 Edition Allianz Life Insurance Company of North America Allianz Life Insurance Company of New York P AMK-118-N Page 1 of 76 When business matters leave the realm of the ordinary,

More information

Avoid the Top Ten Mistakes Made with Beneficiary Designations

Avoid the Top Ten Mistakes Made with Beneficiary Designations Avoid the Top Ten Mistakes Made with Beneficiary Designations www.hornjohnsen.com (608) 829-2525 Estate planning truly is the ultimate gift for your loved ones, and a comprehensive estate plan should always

More information

Common wealth transfer mistakes 1

Common wealth transfer mistakes 1 Common wealth transfer mistakes 1 WEALTH TRANSFER STRATEGY 6 Each year in Canada, billions of assets are transferred at death. If you intend to transfer all, or part of, your assets to your heirs you want

More information

SINGLE CLIENT TRUST WORKSHEET

SINGLE CLIENT TRUST WORKSHEET SINGLE CLIENT TRUST WORKSHEET Restated Amendment: Yes No; If yes, date of trust: If yes, did this office prepare original trust?: Yes No Signing Date: Not Sure ; this will be date of documents. (Date or

More information

An Insured Section 303 Stock Redemption Plan

An Insured Section 303 Stock Redemption Plan An Insured Section 303 Stock Redemption Plan For many people, building a family business...a business that is passed from one generation to the next...is the realization of the American dream. Successfully

More information

BASICS * Irrevocable Life Insurance Trusts

BASICS * Irrevocable Life Insurance Trusts KAREN S. GERSTNER & ASSOCIATES, P.C. 5615 Kirby Drive, Suite 306 Houston, Texas 77005-2448 Telephone (713) 520-5205 Fax (713) 520-5235 www.gerstnerlaw.com BASICS * Irrevocable Life Insurance Trusts Synopsis

More information

A Guide to Estate Planning

A Guide to Estate Planning BOSTON CONNECTICUT FLORIDA NEW JERSEY NEW YORK WASHINGTON, DC www.daypitney.com A Guide to Estate Planning THE IMPORTANCE OF ESTATE PLANNING The goal of estate planning is to direct the transfer and management

More information

Shared Dollar Life Insurance: An inter-generational approach to retirement planning

Shared Dollar Life Insurance: An inter-generational approach to retirement planning Shared Dollar Life Insurance: An inter-generational approach to retirement planning What will retirement look like for our children? If you are like most working people, from time to time you think about

More information

Charitable Giving Techniques

Charitable Giving Techniques Life Event Services Estate Planning Charitable Giving Techniques Giving to charity used to be as simple as writing a check or dropping off old clothes at a charitable organization. But this type of giving,

More information

THE STATE BAR OF CALIFORNIA DO I NEED A WILL? GET THE LEGAL FACTS OF LIFE

THE STATE BAR OF CALIFORNIA DO I NEED A WILL? GET THE LEGAL FACTS OF LIFE THE STATE BAR OF CALIFORNIA DO I NEED A WILL? GET THE LEGAL FACTS OF LIFE Do I need a will? 1 What is a will? 2 Does a will cover everything I own? 3 What happens if I don t have a will? 4 Are there various

More information

Understanding Marital Deduction Trusts

Understanding Marital Deduction Trusts Understanding Marital Deduction Trusts Understanding Marital Deduction Trusts DISCUSSION TOPICS What is a Marital Deduction Trust? How Does a Marital Deduction Trust Work? Special Considerations Regarding

More information

TRUST AND ESTATE PLANNING GLOSSARY

TRUST AND ESTATE PLANNING GLOSSARY TRUST AND ESTATE PLANNING GLOSSARY What is estate planning? Estate planning is the process by which one protects and disposes of his or her wealth, sometimes during life and more often at death, in accordance

More information

Revocable Trust Vs. Irrevocable Trust

Revocable Trust Vs. Irrevocable Trust I am not an attorney but here to help you undertand what things are... Speak to An Asset protection Attorney and find the best solution for you... Revocable Trust Vs. Irrevocable Trust Trusts are relatively

More information

Reference Guide TESTAMENTARY TRUSTS

Reference Guide TESTAMENTARY TRUSTS Reference Guide TESTAMENTARY TRUSTS While most people have heard about trusts, many do not really know what they are or what benefits they offer and often incorrectly believe that trusts are only for wealthy

More information

Beneficiary Designations for Roth IRAs

Beneficiary Designations for Roth IRAs Weller Group LLC Timothy Weller, CFP CERTIFIED FINANCIAL PLANNER 6206 Slocum Road Ontario, NY 14519 315-524-8000 tim@wellergroupllc.com www.wellergroupllc.com Beneficiary Designations for Roth IRAs Page

More information

Advanced Sales. The Importance of Life Insurance. White Paper: The Own Your Own Policy Buy-Sell. Your future. Made easier. Number 11-1 June 1, 2011

Advanced Sales. The Importance of Life Insurance. White Paper: The Own Your Own Policy Buy-Sell. Your future. Made easier. Number 11-1 June 1, 2011 Advanced Sales White Paper: The Own Your Own Policy Buy-Sell Number 11-1 June 1, 2011 Contact us: AdvancedSales@us.ing.com Buy-sell and business continuation agreements are important business planning

More information

ESTATE PLANNING WORKSHEET

ESTATE PLANNING WORKSHEET + ESTATE PLANNING WORKSHEET THE FIRST STEP TOWARD PREPARING APPROPRIATE ESTATE PLANNING DOCUMENTS SUCH AS WILLS, POWERS OF ATTORNEY AND LIVING WILLS IS TO THOROUGHLY REVIEW YOUR CIRCUMSTANCES, NEEDS AND

More information

For Preview Only - Please Do Not Copy 3. The letter also discusses the consequences of dying without a will in Texas.

For Preview Only - Please Do Not Copy 3. The letter also discusses the consequences of dying without a will in Texas. Information & Instructions: Letter to a client explaining wills, trusts, probate and the consequences of dying without a will in Texas. 1. Send this letter to a new client so that they may become familiar

More information

WILLS. a. If you die without a will you forfeit your right to determine the distribution of your probate estate.

WILLS. a. If you die without a will you forfeit your right to determine the distribution of your probate estate. WILLS 1. Do you need a will? a. If you die without a will you forfeit your right to determine the distribution of your probate estate. b. The State of Arkansas decides by statute how your estate is distributed.

More information

Reg. Section 1.401(a)(9)-5, Q&A 5 Required minimum distributions from defined contribution plans

Reg. Section 1.401(a)(9)-5, Q&A 5 Required minimum distributions from defined contribution plans CLICK HERE to return to the home page Reg. Section 1.401(a)(9)-5, Q&A 5 Required minimum distributions from defined contribution plans... Q-. 4.. For required minimum distributions during an employee's

More information

ESTATE EVALUATION. John and Jane Doe

ESTATE EVALUATION. John and Jane Doe ESTATE EVALUATION John and Jane Doe Adam Advisor Investment Advisors 265 Anystreet Suite 123 AnyCity, AnyState, AnyZip (555) 555-5555 adam@investmentadvisors.inv Important Notes Estate Evaluation is a

More information

November is Beneficiary and Estate Planning Month at Taylor Financial Group

November is Beneficiary and Estate Planning Month at Taylor Financial Group Taylor Financial Group s Monthly Planning Letter November 2016 Are you turning 65? The Medicare open enrollment period runs from October 15, 2016 through December 7, 2016. Learn more in this month s planning

More information

Passing on family wealth without making gifts

Passing on family wealth without making gifts Passing on family wealth without making gifts New wealth transfer opportunities As part of a year-end agreement to avoid the Fiscal Cliff crisis, Congress passed the American Taxpayer Relief Act of 0 (ATRA

More information

It s All About the Business

It s All About the Business It s All About the Business Planning Strategies Integrated with Life Insurance to Help a Business Owner Accomplish Goals for Retirement, Business Perpetuation, Successful Business Transition, and Estate

More information

Acting as an Executor

Acting as an Executor Acting as an Executor 7 th Edition Mary Randolph, J.D. Chapter 1 Overview... 1 Learning Objectives... 1 Introduction... 1 What Executors Do... 1 What Trustees Do... 2 Your Legal Duty... 3 Payment for Serving

More information

10Common IRA mistakes

10Common IRA mistakes 10Common IRA mistakes Help protect your valuable retirement assets You ve worked hard to build your retirement assets. And you want them to continue to work hard for you throughout your working career

More information

White Paper: Avoiding Incidents of Policy Ownership to Eliminate Estate Tax

White Paper: Avoiding Incidents of Policy Ownership to Eliminate Estate Tax White Paper: Avoiding Incidents of Policy Ownership to Eliminate Estate Tax MARKET TREND: As planning approaches and products become more complex, care must be taken to avoid the retention or acquisition

More information

Acting as an Executor

Acting as an Executor Acting as an Executor Mary Randolph, J.D. Chapter 1 Overview... 1 Learning Objectives... 1 Introduction... 1 What Executors Do... 1 What Trustees Do... 2 Your Legal Duty... 3 Payment for Serving as an

More information

Required Minimum Distributions

Required Minimum Distributions Required Minimum Distributions What You Need To Know When It Is Time To Start Distributions From Your Retirement Accounts What Are Required Minimum Distributions? Required minimum distributions (RMDs)

More information

FAMILY DATA. Name (First, Middle Initial, Last) Street Address City State Zip. Home Phone # Cell Phone # Sex Date of Birth

FAMILY DATA. Name (First, Middle Initial, Last) Street Address City State Zip. Home Phone # Cell Phone # Sex Date of Birth PAGE 1 FAMILY DATA Marital Status: Single Married Divorced Widower/Widow Wedding Anniversary: CLIENT INFORMATION Name (First, Middle Initial, Last) Age Street Address City State Zip Home Phone # Cell Phone

More information

Joint tenancy vs tenancy in common

Joint tenancy vs tenancy in common The Navigator INVESTMENT, TAX AND LIFESTYLE PERSPECTIVES FROM RBC WEALTH MANAGEMENT SERVICES Joint ownership accounts Key considerations and understanding your options at RBC Dominion Securities Please

More information

DIVIDING A TRUST INTO SUBTRUSTS

DIVIDING A TRUST INTO SUBTRUSTS AFTER A SETTLOR S DEATH Funding Separate Subtrusts Created under a Trust by Layne T. Rushforth Section 1. Overview: This memo is directed to the trustee of a revocable trust where the trust requires the

More information

Death of a Loved One. The Deceased's Will or Trust Documents - The decedent may have had a will or trust. A copy of the will or trust will be

Death of a Loved One. The Deceased's Will or Trust Documents - The decedent may have had a will or trust. A copy of the will or trust will be Death of a Loved One The death of a loved one is one of life s most difficult times and a time for reflection and grieving. However, it also triggers unique financial and tax events that must be dealt

More information

DESIGNATION OF BENEFICIARY

DESIGNATION OF BENEFICIARY DESIGNATION OF BENEFICIARY Questions? Call 1-800-ASK-IMRF (1-800-275-4673). Who can complete this form We can accept the signature of the member only on this form. If someone other than the member signs

More information

A Partnership Insured Entity Purchase Buy-Sell Plan

A Partnership Insured Entity Purchase Buy-Sell Plan A Partnership Insured Entity Purchase Buy-Sell Plan For a partnership to continue after a partner s death, both the surviving partners and the deceased partner's heirs must consent to a reorganization

More information

Understanding trust-held nonqualified annuities

Understanding trust-held nonqualified annuities Understanding trust-held nonqualified annuities Allianz Life Insurance Company of North America Allianz Life Insurance Company of New York AMK-326-N Page 1 of 6 About trust-held nonqualified annuities

More information

Frequently asked questions

Frequently asked questions Page 1 of 6 Frequently asked questions Distributions and rollovers from retirement accounts Choosing what to do with your retirement savings is an important decision. Tax implications are just one of several

More information

SPECIAL NEEDS PLANNING WORKSHEET

SPECIAL NEEDS PLANNING WORKSHEET SPECIAL NEEDS PLANNING WORKSHEET Robert E. Turner Estate and Trust Planning CONTACT PERSON Full Name Street City State Zip Home No. Business No. E-mail Fax No. Relationship to special needs person PERSONAL

More information

ESTATE PLANNING. Estate Planning

ESTATE PLANNING. Estate Planning ESTATE PLANNING Estate Planning 2 Why do you need estate planning? Estate planning is a way for your family to create a plan in case something happens to you. It may help you take care of both the financial

More information

Business planning. Employer-owned life insurance policies

Business planning. Employer-owned life insurance policies Business planning Employer-owned life insurance policies The effects of the Pension Protection Act of 2006 Some things you need to know about Pension Protection Act As you evaluate which planning strategies

More information

Workplace Education Series

Workplace Education Series Preserving Your Savings for Future Generations (Estate Planning) Kelly Quinlan Regional Vice President, Estate Planning March 1, 2018 So, you would like to leave behind a legacy Your questions at this

More information

STATE BAR OF CALIFORNIA TAXATION SECTION ESTATE AND GIFT TAX COMMITTEE 1. PROPOSAL TO CLARIFY TREASURY REGULATION SECTION 1.

STATE BAR OF CALIFORNIA TAXATION SECTION ESTATE AND GIFT TAX COMMITTEE 1. PROPOSAL TO CLARIFY TREASURY REGULATION SECTION 1. STATE BAR OF CALIFORNIA TAXATION SECTION ESTATE AND GIFT TAX COMMITTEE 1 PROPOSAL TO CLARIFY TREASURY REGULATION SECTION 1.401(a)(9)-5, A-7 This proposal was principally prepared by, Vice Chair of the

More information

Estate Planning Worksheet Married Couples

Estate Planning Worksheet Married Couples Estate Planning Worksheet Married Couples The information requested on this worksheet may seem like none of our business, but it is very important that an estate planner understands your present situation

More information

Transfer on Death Addendum and Application

Transfer on Death Addendum and Application Hilltop Securities Inc. and/or Broker/Dealers for which it clears Hilltop Securities Inc. Member NYSE/FINRA/SIPC Transfer on Death Addendum and Application NOTE: If you have an existing IRA Account and

More information

Sample Plan For Illustrative Purposes Only

Sample Plan For Illustrative Purposes Only Your Retirement Plan RETIREMENT ANALYSIS This section of the plan provides an illustration of your retirement situation based on the Surplus Cash Flow Assumption discussed on page 13 and the various recommended

More information

Generation-Skipping Transfer Tax: Planning Considerations for 2018 and Beyond

Generation-Skipping Transfer Tax: Planning Considerations for 2018 and Beyond Generation-Skipping Transfer Tax: Planning Considerations for 2018 and Beyond The Florida Bar Real Property Probate and Trust Law Section 2018 Wills, Trusts & Estates Certification and Practice Review

More information

Manning & Napier Fund, Inc. Individual Retirement Account (IRA) SIMPLE IRA

Manning & Napier Fund, Inc. Individual Retirement Account (IRA) SIMPLE IRA Manning & Napier Fund, Inc. Individual Retirement Account (IRA) SIMPLE IRA TABLE OF CONTENTS SUPPLEMENT TO THE SIMPLE IRA DISCLOSURE STATEMENT 3 SIMPLE INDIVIDUAL RETIREMENT ACCOUNT (IRA) DISCLOSURE STATEMENT

More information

Advanced marketing concepts. Brought to you by the Advanced Consulting Group of Nationwide

Advanced marketing concepts. Brought to you by the Advanced Consulting Group of Nationwide Advanced marketing concepts Brought to you by the Advanced Consulting Group of Nationwide Breaking down and simplifying financial planning techniques When your clients have complex estate, retirement or

More information

Section 11 Probate Glossary

Section 11 Probate Glossary Section 11 Probate Glossary 2012 Investors Empowerment Academy, LLC 119 Abatement A proportional diminution or reduction of the pecuniary legacies, when there are not sufficient funds to pay them in full.

More information

Will Planning To Meet Your Estate Needs

Will Planning To Meet Your Estate Needs Many people recognize that a Will is an essential component of the estate planning process but they fail to give this subject the time or consideration that it requires. It is important to remember that

More information

How to Die and Really Mess Things Up. (And not just by dying)

How to Die and Really Mess Things Up. (And not just by dying) How to Die and Really Mess Things Up (And not just by dying) Linda Willcox Whetung, B.A., J.D. Whetung Law Presentation to the Women s Business Network Of Peterborough January 9, 2013 Whetung Law Barristers,

More information

Estate Planning. Insight on. Saving for college is also good for your estate plan. Will your estate plan benefit from a trust protector?

Estate Planning. Insight on. Saving for college is also good for your estate plan. Will your estate plan benefit from a trust protector? Insight on Estate Planning Year End 2014 Saving for college is also good for your estate plan Will your estate plan benefit from a trust protector? Charitable deductions Substantiate them or lose them

More information

What You Need To Know When It Is Time To Start Distributions From Your Retirement Accounts

What You Need To Know When It Is Time To Start Distributions From Your Retirement Accounts Retirement Planning Required Minimum Distributions What You Need To Know When It Is Time To Start Distributions From Your Retirement Accounts WHAT ARE REQUIRED MINIMUM DISTRIBUTIONS? Required minimum distributions

More information

LEGAL ASSISTANCE OFFICE, LEGAL SERVICES SUPPORT SECTION, NATIONAL CAPITAL REGION, QUANTICO, VIRGINIA ESTATE PLANNING QUESTIONNAIRE

LEGAL ASSISTANCE OFFICE, LEGAL SERVICES SUPPORT SECTION, NATIONAL CAPITAL REGION, QUANTICO, VIRGINIA ESTATE PLANNING QUESTIONNAIRE LEGAL ASSISTANCE OFFICE, LEGAL SERVICES SUPPORT SECTION, NATIONAL CAPITAL REGION, QUANTICO, VIRGINIA ESTATE PLANNING QUESTIONNAIRE Please take the time to COMPLETELY fill out the attached questionnaire,

More information

ESTATE PLANNING AND WILL INFORMATION FORM

ESTATE PLANNING AND WILL INFORMATION FORM ESTATE PLANNING AND WILL INFORMATION FORM ROLSCH LAW OFFICES 423-3RD AVENUE SE P.O. BOX 189 ROCHESTER, MN 55903 PHONE: (507) 280-1943 FAX: (507) 280-4283 WHEN YOU HAVE COMPLETED THIS FORM, please return

More information

Shumaker, Loop & Kendrick, LLP. Sarasota 240 South Pineapple Ave. 10th Floor Sarasota, Florida

Shumaker, Loop & Kendrick, LLP. Sarasota 240 South Pineapple Ave. 10th Floor Sarasota, Florida The Estate Planner may/june 2013 Exemption portability: Should you rely on it? Decant a trust to add trustee flexibility Using the GST tax exemption to build a dynasty Estate Planning Red Flag Your plan

More information

The. Estate Planner. Estate planning for digital assets. Ready to buy a new home? If so, consider using a joint purchase to ease estate tax liability

The. Estate Planner. Estate planning for digital assets. Ready to buy a new home? If so, consider using a joint purchase to ease estate tax liability The Estate Planner May/June 2010 Donating life insurance Turbocharge your charitable gifts Estate planning for digital assets Ready to buy a new home? If so, consider using a joint purchase to ease estate

More information

How to Prepare a Last Will and Testament

How to Prepare a Last Will and Testament How to Prepare a Last Will and Testament The Simplest Way The simplest way to ensure that your funds, property and personal effects will be distributed after your death according to your wishes is to prepare

More information

Charitable Giving Techniques

Charitable Giving Techniques Charitable Giving Techniques Giving to charity used to be as simple as writing a check or dropping off old clothes at a charitable organization. But this type of giving, although appropriate for some,

More information

Traps to Avoid in Lifetime Giving Program

Traps to Avoid in Lifetime Giving Program October 2012 Background There are many ways to transfer property during an individual s lifetime in a manner designed to avoid or minimize federal estate and gift tax. However, many of these opportunities

More information

Individual Retirement Account (IRA)

Individual Retirement Account (IRA) Longleaf Partners Funds Individual Retirement Account (IRA) SIMPLE IRA Table of Contents SIMPLE Individual Retirement Account (IRA) Disclosure Statement 2 SIMPLE Individual Retirement Custodial Account

More information

Estate planning for non-citizens.

Estate planning for non-citizens. Estate Planning Estate planning for non-citizens. The federal gift and estate tax laws that apply to non-united States citizens (aliens) are different from those for citizens. Further, there are different

More information

Estate Planning Worksheet for Individuals

Estate Planning Worksheet for Individuals Estate Planning Worksheet for Individuals The information requested on this worksheet may seem like none of our business, but it is very important that an estate planner understands your present situation

More information

consisting of 100% of your vested account balance to your surviving spouse (if any) as beneficiary.

consisting of 100% of your vested account balance to your surviving spouse (if any) as beneficiary. Instructions and PESP Rules for Beneficiary Designations RETAIN FOR YOUR RECORDS Participant s Federal law provides certain rights and death benefits to spouses of participants in qualified retirement

More information

Who to Name as Your IRA Beneficiaries

Who to Name as Your IRA Beneficiaries Who to Name as Your IRA Beneficiaries Have you named beneficiaries in your IRAs, including primary and contingent beneficiaries? Primary beneficiaries are the first ones in line. If a primary beneficiary

More information

ESTATE PLANNING 101:

ESTATE PLANNING 101: Introduction ESTATE PLANNING 101: THE IMPORTANCE OF DEVELOPING AN ESTATE PLAN At some point, most people will contemplate estate planning. Often, this is prior to or shortly after a significant life event,

More information

Collateral Assignment to Cover Business Bank Loans

Collateral Assignment to Cover Business Bank Loans Platinum Advisory Group, LLC Michael Foley, CLTC, LUTCF Managing Partner 373 Collins Road NE Suite #214 Cedar Rapids, IA 52402 Office: 319-832-2200 Direct: 319-431-7520 mdfoley@mdfoley.com www.platinumadvisorygroupllc.com

More information

Guide for personal representatives

Guide for personal representatives Guide for personal representatives How to navigate the estate settlement process Being appointed as a personal representative (executor) for a deceased individual s estate means taking on a great responsibility.

More information

CHALLENGING A WILL. A challenge to a Will occurs when someone seeks to overturn the last Will and Testament of a deceased person through the courts.

CHALLENGING A WILL. A challenge to a Will occurs when someone seeks to overturn the last Will and Testament of a deceased person through the courts. CHALLENGING A WILL A challenge to a Will occurs when someone seeks to overturn the last Will and Testament of a deceased person through the courts. The challenge to the Will can be done on several grounds,

More information

Via Electronic Mail: Enclosure: ACTEC Comments on Notice /IRC 6035 and 1014(f)

Via Electronic Mail: Enclosure: ACTEC Comments on Notice /IRC 6035 and 1014(f) January 19, 2016 Office of Chief Counsel (Passthroughs and Special Industries) CC:PA:LPD:PR (Notice 2015-57) Room 5203 Internal Revenue Service PO Box 7604 Ben Franklin Station Washington, DC 20044 Via

More information

GENERAL ESTATE PLANNING QUESTIONS

GENERAL ESTATE PLANNING QUESTIONS What is estate planning? GENERAL ESTATE PLANNING QUESTIONS Estate planning is a process to consider alternatives for, to think through, and to set up legally effective arrangements that would meet your

More information

SIMPLE IRA Disclosure Statement & Custodial Account Agreement

SIMPLE IRA Disclosure Statement & Custodial Account Agreement SIMPLE IRA Disclosure Statement & Custodial Account Agreement Table of Contents Page in Document PART I SIMPLE INDIVIDUAL RETIREMENT ACCOUNT DISCLOSURE... 1 SIMPLE IRA CUSTODIAL ACCOUNT AGREEMENT....7

More information

Giving is a part of life. Charitable Giving With Life Insurance

Giving is a part of life. Charitable Giving With Life Insurance Giving is a part of life Charitable Giving With Life Insurance If you are interested in giving more to charity, life insurance may be able to help. When properly implemented, a life insurance policy may

More information

BNY MELLON INVESTMENT SERVICING TRUST COMPANY. Supplement to the Traditional and Roth Individual Retirement Account (IRA) Disclosure Statement

BNY MELLON INVESTMENT SERVICING TRUST COMPANY. Supplement to the Traditional and Roth Individual Retirement Account (IRA) Disclosure Statement BNY MELLON INVESTMENT SERVICING TRUST COMPANY Supplement to the Traditional and Roth Individual Retirement Account (IRA) Disclosure Statement IMPORTANT CHANGES TO THE RULES GOVERNING INDIRECT (60-DAY)

More information

Designation of Beneficiary

Designation of Beneficiary Employees Retirement System Designation of Beneficiary There are a number of times throughout employment when a beneficiary selection should be made: Upon Employment. At the time of hire, you will designate

More information

PROBATING A VERMONT ESTATE *Rules and statutes are subject to change. This information is intended as a guide only*

PROBATING A VERMONT ESTATE *Rules and statutes are subject to change. This information is intended as a guide only* PROBATING A VERMONT ESTATE *Rules and statutes are subject to change. This information is intended as a guide only* This Summary is designed to help you carry out your duties as an executor or administrator

More information

Estate Planning. Insight on. Adapting to the times Estate planning focus shifts to income taxes. International estate planning 101

Estate Planning. Insight on. Adapting to the times Estate planning focus shifts to income taxes. International estate planning 101 Insight on Estate Planning June/July 2014 Adapting to the times Estate planning focus shifts to income taxes International estate planning 101 When is the optimal time to begin receiving Social Security?

More information