Get Beneficiary Designation Form For IRA And 403(b)(7) Accounts

If you get married or divorced, or have children or other life changes, standard sequence will follow those life changes. If you never file a beneficiary designation, your benefit will be paid ing to standard sequence at the time of your death.

The most common designations are to individuals – for example, all to a spouse or in equal shares to children. However, a trust also can be named as an IRA beneficiary, and in many instances, a trust is a better option than naming an individual.

Under the new SECURE Act, eligible designated beneficiaries include spouses, minor children of the original account owner until they reach the age of majority, beneficiaries who are disabled, chronically ill, or not more than 10 years younger than the original account owner, and certain trusts.

A beneficiary is generally any person or entity the account owner chooses to receive the benefits of a retirement account or an IRA after they die. The owner must designate the beneficiary under procedures established by the plan.

Write only one beneficiary on each line. Make sure that you write the full names of all beneficiaries. For example, if you name you children as beneficiaries, DO NOT merely write “children” on one of the lines; instead write the full names of each of your children on separate lines.

It is not a good idea to name a trust as a beneficiary of your IRA because the IRA will lose the benefit of tax-deferred growth. This is because the IRA will have to be distributed faster and then taxed in a different way compared to other situations. The same applies if a business entity or estate is a beneficiary.

If you die with your IRA account and no beneficiary designated, what happens is the plan documents will determine who the default beneficiary is. So, typically, it's the decedent's estate or the surviving spouse.

Inherited IRAs must contain the name of the original IRA owner (the deceased) and indicate that the IRA is inherited. For example, John Doe Jr. Beneficiary IRA, John Doe Sr. deceased 6/1/2020.