North Carolina residents who have an IRA may designate a beneficiary to the account or otherwise include it in an estate plan. How it is accounted for generally depends on who it is going to. It could go to a spouse, which may be beneficial because he or she can simply put the money into his or her own account. Giving the money to a spouse may also be beneficial because that person can delay withdrawals until age 70 1/2.
However, those who don't have spouses significantly younger than age 70 1/2 may be better off transferring the account to a child or grandchild. This is because future generations may benefit from being able to stretch tax benefits throughout their entire lifetime. It is important to note that the "stretch IRA" may not be around in the future because not many people know about it.
Anyone who is planning on transferring IRA assets to someone who is too young to manage the money themselves should consider a trust. This may also be ideal for parents or grandparents with children or grandchildren with special needs as the trust can be the beneficiary. That would allow the money to be held outside of the estate, which may allow the person with special needs to retain the inheritance and not lose out on government benefits.
An IRA may allow an individual to name a beneficiary simply by writing that person's name on a form. An charitable group may also be named as a beneficiary if desired. An attorney may be able to help a person name a beneficiary or review a current designation to see if it is still appropriate. By making a beneficiary designation, it may make it easier to transfer the asset after passing on.