IRA's

IRA's are a great means of reducing your income taxes and saving for retirement when you are working and earning income. However, in your retirement those assets are exposed to nursing home costs, income tax and estate tax.

A surviving spouse may rollover the IRA of the deceased spouse into the surviving spouse's IRA and no taxes are due until the surviving spouse begins to take distributions. Any other beneficiary of an IRA is responsible to pay the taxes on it sooner.

If you enter a nursing home and your assets include an IRA, it will have to be liquidated and the income included in your tax return for that year. To avoid that you may consider taking more than the minimum required distribution from your IRA in the years before you enter a nursing home and avoiding taxation all in one year.