Protecting Your IRA Assets
IRAs 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.
Drawbacks to IRAs include:
(i) For your surviving spouse no taxes are due until he or she begins to take distributions, which they can defer until age 70 and a half. Any other beneficiary of an IRA is responsible to pay the taxes on it sooner. There are ways to avoid these pitfalls.
(ii) Entering a nursing home owning an IRA will require that it be liquidated and all the income included in your tax return for that year. There are ways to avoid these pitfalls.
The information provided herein is for general purposes only and does not to purport to give specific advice on individual matters. If you want individual advice, contact Mary Howie, an Elder Law and Estate Planning attorney practicing in New Hampshire and Massachusetts. Attorney Howie also holds a master’s degree in business administration and finance. Call her at (603) 893-8008.