Friday, November 20, 2009


Roth IRAs historically have been off limits to high income taxpayers. Converting a "Traditional IRA to a "Roth IRA" has been prohibited at income levels above $100,000 through the end of 2009.
Beginning January 1, 2010, all taxpayers, regardless of income, will now have the option of converting their "Traditional IRA" to a "Roth IRA". Thus, financial advisors are expecting a rush in early 2010 by high-income clients converting to Roth IRAs.
The advantage of the Roth IRA is that there are no mandatory annual distributions after age 70 1/2, so savings can be left to grow tax free to heirs. As an estate planning attorney concerned with assisting clients in preserving wealth for their family, the Roth IRA works well with the overall estate plan of many clients.
The new Roth IRA opportunity in 2010 may be especially helpful to people who have rolled over 401(k)s and other plans into IRAs when they changed jobs or retired.
The decision to convert depends on several factors, and working with a capable financial advisor is very important.
Equally important for all qualified retirement plans is to make sure that you have named beneficiaries, both primary and secondary.
When meeting with clients to create a Family Trust, one of the important things I look at is the designation of beneficiaries on retirement accounts, life insurance, and annuities.
Often clients have failed to name beneficiaries on these accounts, or the beneficiary designations are not up to date.
Because retirement, life insurance, and annuities pass to the beneficiaries outside of Probate, having up to date and complete designations of beneficiaries is extremely important.
If you have any questions on this topic or any other topic in Estate Planning, please visit my website at
Attorney at Law
This blog is intended for informational and educational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

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