skip to main content



We’re committed to relieving the tax burdens of businesses, individuals, and families. With a careful assessment of your situation, our tax professionals develop a uniquely customized strategy for your tax planning needs with the objective of minimizing your tax liability. 


August 10, 2018


You have done your planning to make an IRA contribution or Roth IRA conversion and visit your broker to complete the paperwork to make the magic happen. You're given a myriad of documents to complete to set the account up, provide funding details and selecting a beneficiary. You start to gather your things to leave and then you're handed a three page document that appears to be a lot of "boiler plate" language and your broker tells you that no signature is required. You may not be aware that this document is the contract between you and your custodian and it lays out all of the rules you have agreed to follow. Much like a qualified retirement plan, the document governs everything.

Federal tax law gives you the structure to make the choices available to IRA accounts, but every IRA custodian does not need to provide you all of those choices. While many of us will not look at the IRA document/contract, or even read it, there are some critical items you should look for in this agreement.

  • Can you name a secondary beneficiary or allow your primary beneficiary to name a successor beneficiary? Some IRA custodians allow a secondary beneficiary election but most do not provide an opportunity for the beneficiary to name a successor beneficiary. The default likely goes to the estate of the beneficiary which results in the loss of stretch benefits.
  • Does the IRA custodian allow a trust as a beneficiary? Will they honor a disclaimer or accept a power of attorney (POA) election? IRA custodians do not have to accept these documents or follow instructions from a trustee or POA designate.
  • If a non-spouse beneficiary is selected, can that beneficiary move the inherited IRA account to a custodian of their liking? Many custodians will not allow trustee-to-trustee transfers and will only issue a check payable to the beneficiary. Because non-spouse beneficiaries are not able to use the 60 day rollover rule, any distribution to them becomes immediately taxable and any stretch benefit is lost.

In many cases these issues can be managed when the problem is known. It is the unknown event that throws all of your good planning out the window. For help with IRA planning and guidance, contact us in one of our many locations.

Hide Firm Disclaimer


UHY LLP is a licensed independent CPA firm that performs attest services in an alternative practice structure with UHY Advisors, Inc., and its subsidiary entities. UHY Advisors, Inc.’s subsidiaries, including UHY Consulting, Inc., provide tax and business consulting services through wholly owned subsidiary entities that operate under the name of “UHY Advisors” and “UHY Consulting”. UHY Advisors, Inc., and its subsidiary entities are not licensed CPA firms. UHY LLP, UHY Advisors, Inc. and UHY Consulting are U.S. members of Urbach Hacker Young International Limited, a UK company, and form part of the international UHY network of legally independent accounting and consulting firms. “UHY” is the brand name for the UHY international network. Any services described herein are provided by UHY LLP, UHY Advisors and/or UHY Consulting (as the case may be) and not by UHY or any other member firm of UHY. Neither UHY nor any member of UHY has any liability for services provided by other members.

On this website, (i) the term "our firm", "we" and terms of similar import, denote the alternative practice structure conducted by UHY LLP and UHY Advisors, Inc. and its subsidiary entities, and (ii) the term "UHYI" denotes the UHY international network, in each case as more fully described in the preceding paragraph.