Handling An IRA At Death
The IRA, or Individual Retirement Account, is a special account designed to help men and women save money to use for retirement. The IRA has many advantages that keep it a top choice for those seeking to save for retirement, including tax-free deposits. It can be used in addition to a 401(k) or on its own. However, what happens if you have a joint account with your spouse and they pass away before the period?
If a spouse passes away before the money from an IRA can be withdrew, you may want to consider claiming the IRA at the time of the death. This step could provide you with a larger amount of money to survive with. The money can be taken from the account and a lot of hassle and penalties will be avoided. The money from the IRA can be used in a number of different ways, all of which can benefit you when done properly.
The IRA will encounter estate taxes upon death. The reason for this is because the money from the IRA can be withdrawn at any time or beneficiaries changed. If the beneficiary isn’t changed on the IRA form the plan converts over into the estate and is then probated upon death to the person assigned to get it. It is essential that you have a beneficiary to avoid this penalty.
In most cases your spouse will be the beneficiary on the IRA. When the spouse passes away there is the option of owning the IRA yourself or becoming the beneficiary of that said plan. Either way the IRA is accessible to the spouse. The children are also a choice for the beneficiary. They can be designated as the main beneficiary or as a secondary beneficiary.
Should your spouse pass away with an IRA account open it is in your best interest to seek assistance from an IRA specialist. These knowledgeable individuals can help you better understand your options as well as assist in preparing the IRA in a way that will be of the most benefit to you. Visit http://www.ira-to-gold.com/ to find out more.
Understanding your options for the IRA upon death of your spouse is very important if you hold a joint account together. It is your money and your retirement, and there is no room for errors. Make sure that you speak with a professional without delay and handle the IRA in the most appropriate manner ever.