Choose the beneficiary of your retirement plan carefully

Description

Abstract: This article describes the importance of understanding how the beneficiary one chooses to inherit an IRA, 401(k) plan or other retirement account can affect the income and estate tax consequences. For non-Roth accounts, there are three factors to consider that can affect the beneficiary’s income tax liability. It’s also important to consider the estate tax consequences of choosing a spouse, vs. someone else, as beneficiary.