When a surviving spouse suffers from dementia there could be issues with rolling over the deceased spouses IRA. “Unfortunately, typically, there is no way to name a successor beneficiary until the original IRA owner dies and IRA custodians only allow the primary beneficiary to name a successor beneficiary, according to Choate, a lawyer who specializes in estate planning for retirement benefits.” There is a way to get a state court to appoint a guardian for a surviving spouse suffering from dementia if they are willing to handle the high costs and difficulties of a public court process. It is a good idea to appoint a trusted person to have power of attorney over financial issues. Another technique discussed in this column involves having the IRA in the form of a trust known as an individual retirement trust (IRT). This type of trust instrument by itself will not let a trustee roll over an IRA, but an IRT combined with a power of attorney for retirement benefits will achieve this purpose.
See Alex Padalka, How to Prepare for an IRA Beneficiary’s Possible Dementia, Financial Advisor IQ, December 15, 2015.
