What's New

Cook Co. 2007 Homeowner & Senior Exemption Forms are here

Real Estate Blues

Illinois Deed Providers Controversy

How to give IRA to charity tax free

How to Attract a Buyer in a Down Real Estate Market

Wall St. Journal Article on Inheriting 401ks Why it's important: Last year, I had a trust administration client whose mother died with a large 401K plan (more than $800,000.00). The totally unfair tax law at the time forced the client to pay income tax on the whole thing in the year of her mother's death. If this new law that allows 401ks to be "inherited" were in effect, she could have spread the income tax over many years, saving thousands of dollars.

Client extranet

Last year I started experimenting with setting up a client extranet. Some services are too expensive and others are too hard to use. (An extranet is web site that is specific to each client and is password protected).

Everyone allowed access to the extranet gets notice by e-mail anytime a message is posted to the site or a file is uploaded. We are now to the point where it is quick and easy to set up an extranet for any client.  The extranet helps client stay up to date on their cases.

This short video shows how the extranet works.

There is no extra charge for establishing a site.

IRA Protection Trust

New type of trust allows "stretch out" of IRA for heirs, protects IRA from divorce, creditors and mismanagement

The IRS recently allowed the IRA Protection Trust. Previously, it was difficult, if not impossible, to leave an IRA account to a trust and to allow heirs to stretch out payments from the IRA over their life expectancies.  Now, it is possible to do so using the IRA Protection Trust.

The benefits of the trust are as follows:

1. IRA distributions can be taken over the life expectancy of each beneficiary. "Stretching out" IRA distributions allows the IRA funds to continue to accumulate tax free inside the IRA. The tax-free compounding of the funds inside the IRA greatly increases the funds available to heirs as compared to taking all of the funds out of the IRA (and paying taxes on the funds).

2. IRA funds are protected from divorce and creditors and influence of in-laws.

3. Distributions from IRAs can be "turned off" and the IRA Protection Trust can be turned into an "accumulation" trust. This builds in flexibility. If a trust beneficiary became disabled and was receiving SSI, the trust would not disqualify the heir from SSI payments (which are needs based).

To read more about the pros and cons of an IRA Protection trust click here.