IRAs are a great way to save for retirement, thanks to tax-deferred growth and tax-deductible contributions. About 35% of American households contribute to traditional IRAs, while 36% contribute to Roth IRAs.*

But the news isn't all good.

When you start withdrawing money from your IRA, those withdrawals get taxed as income. If you don't spend down your IRA in your lifetime, its remaining value counts toward your total estate value. This creates a greater estate tax burden for your heirs, who now face possible estate taxes plus federal income taxes just to inherit that money.

This isn't what you had in mind while you were working and saving for all those years, is it? No one wants to go through double taxation, which is essentially what happens when you try to pass on wealth through an IRA.

I can help you use that money to generate a tax-free income stream for your spouse and family.

➡️ Want to talk to a real person about maximizing your financial assets? Call or email me for a personalized consultation!

Use Your IRA to Create a Legacy

If you don't need your IRA distributions to cover your day-to-day costs of living, there's a better way to use them. I can show you how to turn the taxable withdrawals from your IRA into tax-free income for your spouse and heirs.

Here's how the process works:

  1. Begin taking withdrawals from your IRA, which will be taxed as income before you receive them. Decreasing the balance of the IRA helps lessen any possible estate tax.
  2. Gift those withdrawals to a life insurance trust (ILIT). This ensures the life insurance death benefit isn't subject to estate taxes.
  3. Your trust buys a life insurance policy on you and retains ownership of the policy. You can't own it, or there would be more tax implications.
  4. When you pass away, your beneficiaries inherit both your IRA and the income-tax free death benefit from the life insurance policy.

➡️ Want to talk to a real person about maximizing your financial assets? Call or email me for a personalized consultation!

*RothIRA.com

This material is not intended to be used to avoid penalties imposed under the Internal Revenue Code. Always consult with your independent advisors regarding your particular financial and legal situation. The material here is presented for informational purposes only and should not be construed as tax or legal advice.