Orange County California

Trust Attorneys


Orange County Estate Planning Attorney Warns Against Taking the IRA in One Lump Sum

Let’s assume that I and my wife are leaving our IRA to our children. If my children/grandchildren are the beneficiaries, they have 3 options for how to get their IRA and to pay the taxes on it. The three options they have to take the IRA are lump sum, 5 years, and remainder of life expectancy (but they are not able to roll it into their IRA account). So if we assume we are leaving our son one quarter of a million in IRAs then if he takes the lump sum, he must pay income tax on the full amount in one year. Between the federal taxes, state taxes, Social Security, and other taxes within the tax brackets then the tax payment will be approximately 50%.  This is the one of the biggest drawbacks to taking a lump sum. Contact us today and set up an appointment.

We offer a many different resources and pamphlets on the subject of creating, updating and implementing estate plans. We also offer a regularly scheduled seminar in our office to help people determine what the best options are for them in their estate planning needs. We hope you sign up for one of our seminars to help you find your best options. We regularly conduct free seminars designed to teach about the benefits of creating an estate plan. The seminars are held on-site at our Anaheim office inside of our “classroom”. We offer light snacks and refreshments to the attendees and the group is often small and intimate, which allows for questions to be asked comfortably and for a very relaxed environment. Please encourage your loved ones to attend the seminar so that they may learn more about the estate planning process and benefits.

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