Stretching it Out in Santa Rosa, California

James Zakasky
An estate attorney who goes beyond drafting wills and creating trusts

Cat Stretching it out

Stretching it Out in Santa Rosa California

A stretch out is a way to make your Retirement Plan last longer, and still reap the benefits of a growing economy without being taxed or paid out to creditors or predators of your beneficiary. It works like this:

  1. You name your spouse/partner as the primary beneficiary of your IRA or 401K Plan.

  2. You name your trust for the benefit of your oldest descendant(s) as the remainder beneficiary of your 401K or IRA Plan. (Children or Grandchildren)

  3. When you die, your retirement plan gets transferred to Spouse/Partner’s IRA or 401K account.

  4. Spouse partner must take Required Minimum Distributions each year based on Life Expectancy. No distribution then 50% penalty from the IRS … Ouch!

  5. When Spouse partner dies their 401K or IRA is put into Trust for the benefit of the Children. Children then can take Required Minimum Distributions each year based on Life Expectancy.  No distribution then 50% penalty from the IRS … Ouch!

The Stretch out accomplishes several goals the main objective allowing the Spouse/Partner to be provided for while maintaining and preserving the IRA or 401K for future generations. If the spouse partner has other means of support like social security, their own 401K, pension, etc. they will not have to liquidate the 401K or IRA for support but only take minimal distributions that will preserve the retirement plan for future generations.

Along with preserving the retirement account for future generations the stretch out can provide asset protection from Bankruptcy, Divorce and Lawsuits.

If you have a qualified retirement plan, please get an evaluation from the Law Offices of James A. Zakasky at 707-595-1148 and explore the options of a Stretch Out Plan.

 

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