Transferring retirement plans to your Trust

It’s generally not necessary to transfer the ownership of a retirement plan to a Trust. This can actually have negative tax effects. Instead, the focus is more often on where the proceeds go. 

Rather than changing the ownership of the retirement plan, you can designate a Beneficiary to receive the proceeds at your death. As with life insurance, a common consideration is whether you want the proceeds paid directly or whether you want the proceeds to go to the Trust where you have more control on when and how the proceeds are distributed.

A common approach is to name your spouse as the primary Beneficiary and then name the Trust as the alternate Beneficiary. Your tax advisor should be able to help determine the best option for you and your particular tax circumstances.

Each plan administrator has its own Beneficiary Designation forms, so you should contact your plan administrator for more information and request any forms required to update your beneficiary designation.

Learn how to title Assets here and where to find your Taxpayer Identification Number here. You can also view our full Trust Funding Guide here!

This information is intended as a reference only. It is not legal advice nor intended to cover every possible situation. Please consult an attorney if you have specific questions. Some details for funding your Trust may change over time. For example, if the Trustee changes, that would likely affect how you would title assets held in the Trust.

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