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Taxes when a Trust is listed as a Beneficiary on an IRA
My father and I have a dilemma. My Dad wants to leave my sister money from his IRA but as the Successor Trustee he wants me to manage the money through his Trust so that my sister doesn’t get the money all at once because she is a spendthrift. My understanding is that if his Trust is listed as the beneficiary on his IRA then the IRA distributions will go directly to the Trust for me to manage for the benefit of my sister but will be taxed at a whopping 37.5% tax rate. Is that correct and is there any way around this?
August 12, 2021
12:33 PM