SecondCor521
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Scenario:
A couple has a bypass trust established in their wills.
Husband has a $2M traditional IRA and is taking RMDs. Primary beneficiary on traditional IRA is Wife, secondary beneficiary is three kids in thirds.
If Husband dies, I understand that the trad IRA goes to wife and she can employ the stretch IRA technique.
True/False Questions (with my guesses):
1. The $2M has not funded the bypass trust in this case because it didn't pass through probate. (True)
2. Only assets that pass through probate can be used to fund the bypass trust. (True)
3. If the primary beneficiary were changed to Husband's estate,
a. it could be used to fund the bypass trust (True)
b. it would preserve the Husband's estate tax exemption (True)
c. It would prevent the use of the stretch IRA technique (True)
4. If the primary beneficiary were changed to the bypass trust,
a. it could be used to fund the bypass trust (True)
b. it would preserve the Husband's estate tax exemption (True)
c. It would prevent the use of the stretch IRA technique (True)
Thanks,
2Cor521
A couple has a bypass trust established in their wills.
Husband has a $2M traditional IRA and is taking RMDs. Primary beneficiary on traditional IRA is Wife, secondary beneficiary is three kids in thirds.
If Husband dies, I understand that the trad IRA goes to wife and she can employ the stretch IRA technique.
True/False Questions (with my guesses):
1. The $2M has not funded the bypass trust in this case because it didn't pass through probate. (True)
2. Only assets that pass through probate can be used to fund the bypass trust. (True)
3. If the primary beneficiary were changed to Husband's estate,
a. it could be used to fund the bypass trust (True)
b. it would preserve the Husband's estate tax exemption (True)
c. It would prevent the use of the stretch IRA technique (True)
4. If the primary beneficiary were changed to the bypass trust,
a. it could be used to fund the bypass trust (True)
b. it would preserve the Husband's estate tax exemption (True)
c. It would prevent the use of the stretch IRA technique (True)
Thanks,
2Cor521