Page 11 - Stuart Exposure - July '20

Stuart Exposure, Page 11

lEGal talk

How SECURE Is accounts until they have reached age 72 (as opposed to stretch was that income
The benefit of the
70½) and allowing them to continue to make contributions
Your IRA Planning? to their retirement plans after age 70½, so long as they tax liability associated
continue to work. with distributions from
By Ryan Abernethy The SECURE Act has also brought changes that will an inherited retirement
You may have heard of the “SECURE Act” and significantly affect many individual’s estate plans. account could be spread
how this new legislation brought changes to retirement It has eliminated almost entirely the opportunity for (or stretched) over that
planning. those inheriting an interest in a retirement plan at the designated beneficiary’s
It has many benefits, including allowing retirement plan owner’s death (designated beneficiary) to “stretch” lifetime if he or she only
plan owners to refrain from withdrawing required annual RMDs from the plan’s interest over the designated withdrew annual RMD
minimum distributions (RMDs) from IRA and 401(k) beneficiary’s remaining lifetime. amounts, or by naming a
special form of trust as
beneficiary of a retirement account, with the trust
Louis Vuitton Wine? ‘Where distributing RMD amounts directly to the trust’s
beneficiary each year (while simultaneously controlling
the beneficiary’s ability to withdraw greater amounts from
Fashion And Wine Merge ...’ the account).

Under these two options, income tax would only be
paid on amounts actually distributed to the beneficiary
By Laura Berrio, including Dom Perignon, Veuve Clicquot, and Belvedere (typically just the RMD amount), with remaining account
Freelance Writer/Blogger Vodka, along with many other “luxury brands.” funds continuing to grow tax-free.
When I think of Dom Other fashion companies have followed the same Under the SECURE Act, this income tax deferral
Perignon, Veuve Clicquot, path. Ferragamo and Bulgari have vineyards and estates opportunity has been eliminated for most designated
and French wine, I picture in Southern Tuscany. One of the Guess brothers, who beneficiaries.
a small family-owned cofounded the company, has a 55-acre Napa vineyard and Now, with very limited exceptions, a designated
business with fields of old winery. Chanel bought St. Supery vineyard and winery in beneficiary must receive distributions from inherited
vine grapes. In reality you Napa. retirement plan interest over a maximum ten-year period.
have to look to the fashion With all of these “luxury” brand companies lending their For individuals intending to have retirement plan assets
industry to find the owner. name and efforts to making great wine and Champagne, it pass in trust for the benefit of their beneficiaries (whether
Wine and fashion has me thinking of other fun potential ventures. … a spouse, child or otherwise) and have those assets be
are two of life’s greatest • AVEDA could make an organic wine managed for that beneficiary outside of the beneficiary’s
pleasures! What goes better than a glass of wine and a • Rolex could make Champagne to rival Dom Perignon direct control, changes to the estate plan may be necessary.
fashion magazine? You don’t have to look far to find brands • YSL could make a wine that has anti-aging beauty If you have significant retirement plan asset holdings,
like Louis Vuitton, Chanel, Ferragamo and Diesel in the properties the SECURE Act may make it necessary to consider
wine business! The list is endless, but one thing is for sure, more and alternative planning strategies if lifetime asset protection
In the past you could buy a Louis Vuitton wine carrier more companies are entering the world of “wine” and for beneficiaries is a primary goal.
… but now you can buy their wine and Champagne to go changing our perception of our everyday glass of wine to You can do this while also avoiding the negative
in them. In 1987 Louis Vuitton and Moet Hennessy merged that of a “lifestyle” choice. income tax consequences typically associated with having
and formed LVMH. LVMH now owns over 60 subsidiaries, ~Cheers! retirement plan assets accumulated in a trust—a double
win for your beneficiaries!
If these changes have you worried about how your
retirement plan assets will pass to your beneficiaries, contact
a qualified estate planning attorney to discuss if you’re
affected and what changes need to be made to your plan.
Ryan C. Abernethy, associate attorney and counselor
at law at Abernethy Law Group, 130 S. Indian River Dr.,
No. 201, Fort Pierce can be contacted at (772) 489-4901
or rabernethy@abernethylawgroup.com.

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