Retirement Tax Planning Summary

• § 1.00 Introduction
• —–[1] Summary of Tax Planning Ideas and Techniques
• —–[2] The Key Role of Qualified Retirement Plans
• —–[3] Tax-Favored Plans for Government Employees
• —–[4] Tax-Favored Plans for Employees of Tax-Exempt Organizations
• —–[5] Nonqualified Employer Retirement Plans
• —–[6] Individual Retirement Arrangements (IRAs and Roth IRAs)
• —–[7] Designated Roth Accounts
• —–[8] Retiring Partners and Sole Proprietors
• —–[9] The Role of Personally Purchased Annuities

• § 1.01 Initial Tax Planning for Retirement
• —–[1] Initial Considerations for Retirement Tax Planning
• —–[2] Payment Options Under Employer Retirement Plans
• ———-[a] Payment Options in General
• ———-[b] Non-tax Considerations Affecting Choice of Payment Option
• ———-[c] Taxation of an Annuity Payable over One or More Lifetimes
• ———-[d] Taxation of Required Spousal Annuities
• ———-[e] Taxation of Distributed Annuity or Life Insurance Contracts
• ———-[f] Taxation of a Lump Sum Distribution of the Entire Amount of Benefits
• ———-[g] Taxation of a Lump Sum Distribution of a Portion of Total Benefits
• ———-[h] Distribution of Employer Securities
• —————[i] Distribution of Employer Securities Containing Net Unrealized Appreciation
• —————[ii] Distributions from Stock Bonus Plans and ESOPs
• ———-[i] When Payments Begin Under Employer Retirement Plans
• —————[i] When Qualified Plans Must Begin Payments
• —————[ii] When Payments May Begin Under Section 401(k) and 403(b) Plans
• —————[iii] When Payments May Commence Under Employer Pension Plans
• —————[iv] When Payments May Commence Under Eligible State/Local Government Plans
• —————[v] Earliest Date Retirement Payments May Begin Without Penalty
• —————[vi] Latest Date Retirement Payments Begin Under Tax-Favored Employer Plans
• ———-[j] Payment Elections Under Eligible Exempt Organization Plans
• ———-[k] Planning Payments Under Unfunded Nonqualified Plans
• —————[i] Elections Changing the Time and Form of Payment of Deferred Compensation
• —————[ii] Special Treatment for Plans of States and Tax-Exempt Organizations
• —————[iii] Short-Term Deferrals Not Subject to Usual Rules for Deferred Compensation
• ———-[l] Lump Sum Payment Election by Government Employees Under FERS and CSRS
• ———-[m] Lump Sum Election by Members of the U.S. Military Under the BRS
• ———-[n] Qualified Retirement Plan Annuity Earned Substantially Outside U.S
• ———-[o] U.S. Government Benefits Payable to Foreign Persons
• —–[3] Transfers from Employer Retirement Plans to IRAs
• ———-[a] Transfers from Employer Retirement Plans to IRAs Generally
• ———-[b] Employer Plans Qualifying for Tax-Free Transfers to IRAs
• ———-[c] Tax-Free Trustee-to-Trustee Transfers from a Plan to an IRA
• ———-[d] Tax-Free Indirect Rollovers from a Plan to an IRA
• ———-[e] Retention or Transfer of Investment in the Plan
• ———-[f] Retention or Transfer of Employer Securities
• ———-[g] Timing of Transfers from a Qualified Plan to an IRA
• ———-[h] Transfers from Retirement Plans to IRAs by Surviving Spouse
• —–[4] Rollovers from One Retirement Plan to Another Retirement Plan
• —–[5] IRA Rollovers to Qualified Retirement Plans
• —–[6] Avoiding the Penalty on Certain Early Distributions
• ———-[a] The Penalty Tax and Exceptions
• ———-[b] Avoiding the Penalty Using Substantially Equal Periodic Payments
• —————[i] The Substantially Equal Payment Exception Generally
• —————[ii] Substantially Equal Exception Safe Harbors
• —————[iii] Tailoring the Source and Amount of Substantially Equal Payments
• ———-[c] Avoiding the Penalty by Purchasing a Single-Premium Immediate Annuity
• ———-[d] IRA Funds Transferred to an Employer Plan to Avoid the Penalty
• ———-[e] Roth IRA Conversion While Receiving Substantially Equal Periodic Payments
• ———-[f] Retention or Transfer of Investment in the Plan
• ———-[g] Young Surviving Spouse
• ———-[h] Form 5329 and the Statute of Limitations
• ———-[i] Early Retirement of a Police Officer, Firefighter, or Emergency Medical Worker
• —–[7] Employee Stock Options and Other Stock Rights
• ———-[a] Dealing with Statutory Employee Stock Options and Stock Received
• —————[i] Favorable Tax Treatment of Statutory Employee Stock Options
• —————[ii] Meeting Statutory Stock Option Conditions
• —————[iii] Favorable Treatment of Statutory Stock Options After Retiree’s Death
• —————[iv] Paying the ISO Exercise Price with Previously-Acquired Employer Stock
• —————[v] Unfavorable Alternative Minimum Tax (AMT) Treatment of ISOs
• —————[vi] Elimination of Payroll Taxes on ISO Cancellations from M&A Transactions
• ———-[b] Dealing with Nonstatutory Stock Options and Stock Received
• —————[i] Tax Treatment of Nonstatutory Stock Options
• —————[ii] Paying the Option Price with Previously-Acquired Employer Stock
• —————[iii] Treatment of Forfeitures of Nonstatutory Stock
• —————[iv] Gifts of Unvested Nonstatutory Stock
• —————[v] Transfers of Nonstatutory Options or Stock Incident to Divorce
• —————[vi] Death of Retiree Before Vesting of Nonstatutory Stock
• ———-[c] Dealing with Employee Stock Rights
• ———-[d] Qualified Equity Grants
• —–[8] Golden Parachute Payments
• —–[9] Qualified Small Business Stock (QSB Stock)
• —–[10] Retirement of Partners and Sole Proprietors
• ———-[a] Partners and Proprietors as “Self-Employed Individuals” Under Retirement Plans
• ———-[b] Special Section 736 Provisions for Retiring Partners
• —–[11] Tax Treatment of Same-Sex Marriages

• § 1.02 Tax Planning During Retirement Years
• —–[1] Funds in Tax-Favored Plans Contributed to Roth IRAs or Roth Accounts
• ———-[a] Taxable Qualified Rollover Contributions (Roth Conversions)
• ———-[b] Long-term Tax Savings Due to Tax Rate Differential
• ———-[c] Long-term Tax Savings Due to Transfer of High Income Assets
• ———-[d] Transfers to Roth IRAs When Funds Not Needed in Retirement
• ———-[e] Retention of Funds in Both Traditional IRAs and Roth IRAs
• ———-[f] Potential Collateral Benefits of Roth Conversions
• ———-[g] Limitations on Roth Conversions
• ———-[h] Trustee-to-Trustee Roth Conversions
• ———-[i] Indirect Roth Conversions from a Tax-Favored Plan to a Roth IRA
• ———-[j] Choice of Qualified Plan or IRA for Making a Roth Conversion
• —————[i] Different Roth Conversion Tax Computations for IRAs and Qualified Plans
• —————[ii] Varying the Source and Timing of Roth Conversions
• —————[iii] Multiple Rollovers from a Single Distribution by a Qualified Plan
• ———-[k] Roth Conversion While  Receiving Substantially Equal Periodic Payments
• ———-[l] Recharacterizations of Roth Conversions Made Before the Year 2018
• —————[i] Desirability, Qualification, and Effect of a Recharacterization
• —————[ii] Limited Time for Completion of a Recharacterization
• ———-[m] Roth Conversions by Surviving Spouses
• ———-[n] Arrangements That May Shift Value to a Roth IRA from Related Entities
• ———-[o] Roth Conversions to Designated Roth accounts
• —————[i] Roth Conversions to Designated Roth Accounts Generally
• —————[ii] Multiple Rollovers that Include a Roth Conversion to a Roth Account
• —–[2] Nontaxable Rollovers from Designated Roth Accounts
• ———-[a] Designated Roth Accounts Within Cash or Deferred Arrangements
• ———-[b] Rollovers from Designated Roth Accounts to Other Roth Accounts
• ———-[c] Rollovers from Designated Roth Accounts to Roth IRAs
• ———-[d] Choice of Rollover to another Designated Roth Account or to a Roth IRA
• ———-[e] Multiple Rollovers from a Single Designated Roth Account Distribution
• —–[3] Planning for Required Minimum Distributions
• ———-[a] Required Minimum Distribution Rules Generally
• ———-[b] Choice of Annuity or Non-Annuity Minimum Distributions
• ———-[c] Planning Non-Annuity Distributions for the First Minimum Distribution Year
• ———-[d] Planning Non-Annuity Distributions for Married Individuals
• ———-[e] IRAs and Plans Making both Annuity and Non-Annuity Minimum Distributions
• ———-[f] Form 5329 and the Statute of Limitations
• —–[4] Tax Planning for Required Spousal Annuities
• ———-[a] Two Types of Spousal Annuities: QJSAs and QPSAs
• ———-[b] Tax Deferral for Participants
• ———-[c] Tax Deferral for Surviving Spouses
• ———-[d] Dealing with Refusal to Consent
• ———-[e] Marriage and Divorce Planning
• —–[5] Temporary Personal Use of Rolled-Over Funds
• —–[6] Planning for Qualified Loans
• ———-[a] Qualified Plan Loans in General
• ———-[b] Refinancing to Cure a Default on a Five-Year Qualified Plan Loan
• ———-[c] Rollovers of Plan Offsets for Qualified Loans
• —–[7] The Nontaxable Portion of Social Security Benefits
• ———-[a] Lowering Taxes on Social Security Benefits Generally
• ———-[b] Lump Sum Payment of Prior Year Social Security Benefits
• —–[8] The Nontaxable Portion of U.S. Military Disability Pay
• —–[9] Plan Insurance Premium Payments for Retired Police, Firefighters, etc.
• —-[10] Chronic Illness Costs and Insurance
• ———-[a] Deductions for Long-Term Care Services
• ———-[b] Long-Term Care Insurance
• ———-[c] Fees Paid to Continuing Care Retirement Communities
• —-[11] IRA Distributions Paid Directly to Charities
• —-[12] Payments for Long-Term Disability
• ———-[a] Sourced Disability Payments
• —————[i] Taxable in Proportion to Employer Contributions
• —————[ii] Conversions to Retirement Benefits
• —————[iii] Corrections of Employer Errors or Methodology
• ———-[b] Wholly Exempt Disability Benefits
• —————[i] Types of Exempt Disability Benefits
• —————[ii] Workers’ Compensation
• —————[iii] Tort Judgments or Settlements for Disability
• —————[iv] Structured Settlements
• —————[v] Interest, Medical Expenses, and Attorneys Fees
• —————[vi] Power of Attorney Effective Upon Disability
• —-[13] Reverse Mortgages: Drawing Retirement Funds from Home Equity
• —-[14] Tax Treatment of the Sale of a Retiree’s Residence
• —-[15] Minimizing the Medicare Tax on Net Investment Incomee
• —-[16] Tax-Free Restorative Payments
• —-[17] IRA Contributions by Retirees Working Part-Time

• § 1.03 Beneficiary Tax Planning
• —–[1] Beneficiary Tax Deferral Planning Generally
• —–[2] Tax Deferral Planning for Surviving Spouse Who Is Sole Beneficiary
• ———-[a] Spousal Election to Own IRA or Roth IRA
• —————[i] Spousal Ownership of IRAs and Roth IRAs Generally
• —————[ii] IRA or Roth IRA Ownership Election for Young Surviving Spouse?
• —————[iii] Alternative Where IRA Ownership Election Not Available
• —————[iv] Interest of Surviving Spouse in a Qualified Retirement Plan
• ——————–[A] Tax-Free Rollovers to Spouses’ IRAs or Roth IRAs
• ——————–[B] Tax-Free Rollovers to Spouses’ Retirement Plans
• ——————–[C] Roth Conversions to Spouses’ Roth IRAs or Roth Accounts
• ———-[b] Surviving Spouses’ Designation as Owner or Beneficiary after Rollover
• ———-[c] Community Property Interests; Spouses and Registered Domestic Partners
• —–[3] Tax Planning if Spouse Is Not a Beneficiary or Is Not the Sole Beneficiary
• ———-[a] Alternative Rules When Surviving Spouse Not Sole Beneficiary
• ———-[b] Distributions to Nondesignated Beneficiaries (NDBs)
• —————[i] Distributions to an NDB if Retiree Dies after Required Beginning Date (RBD)
• —————[ii] Distributions to an NDB if Retiree Dies before Required Beginning Date
• ———-[c] Distributions to Ineligible Designated Beneficiaries (IDBs)
• ———-[d] Distributions to Eligible Designated Beneficiaries (EDBs)
• —————[i] Distributions When Some or All of the Beneficiaries of a Plan Are EDBs
• —————[ii] Death of Designated Beneficiary or EDB
• ———-[e] Transition Rules for Beneficiary Distributions Under the Secure Act of 2019
• —–[4] Surviving Spouse Who Dies before Minimum Distributions Required
• —–[5] Advantages of Establishing Separate Accounts for Beneficiaries
• —–[6] Advantages of a Trust as the Beneficiary of a Tax-favored Plan
• ———-[a] Choosing a Trust as Beneficiary of a Tax-favored Plan
• ———-[b] Designated Beneficiary Exception for Certain Trusts
• ———-[c] Use of Conduit Trusts
• ———-[d] Use of Accumulation Trusts with Identifiable Beneficiaries
• ———-[e] Use of Powers of Appointment
• ———-[f] Trust with Non-Individual Beneficiary
• ———-[g] Separate Accounts, Separate Trusts, and Subtrusts
• ———-[h] Planning with Trust Tax Accounting Rules
• —————[i] Special Allocations of Different Classes of Income to Different Beneficiaries
• —————[ii] Special Allocations of Trust Expenses to Classes of Income
• —————[iii] Separate and Independent Beneficiary Shares in a Trust
• —————[iv] Trust Transfers of Beneficial Interests in IRAs and Other Retirement Plans
• —————[v] Charitable Contributions Paid by a Trust
• ———-[i] Trusteed IRA as Alternative to Naming Trust as Beneficiary
• ———-[j] Placing Benefits Left to Surviving Spouse in Trust
• —–[7] Use of Disclaimers in Post-Mortem Tax Planning
• —–[8] Designation of Charity as a Beneficiary
• —–[9] Advantages of Personally Purchasing an Annuity
• —–[10] Beneficiary Elections for Unfunded Nonqualified Plans
• —-[11] Rollover of Military Death Gratuities and Life Insurance Proceeds
• —-[12] National Guardsmen or Reservists Dying or Injured on Active Duty
• —-[13] Planning to Reduce Federal Estate Taxes on Retirement Benefits
• ———-[a] Federal Estate Taxes Generally
• ———-[b] Use of the Marital Deduction for Retirement Benefits
• ———-[c] Use of the Charitable Deduction for Retirement Benefits
• ———-[d] Effective Use of the Applicable Exclusion
• —————[i] Portability of the Applicable Exclusion
• —————[ii] Traditional Planning May Still Be Useful
• —————[iii] By-Pass Trust as Beneficiary of a Tax-Favored Retirement Plan
• ———-[e] Effective Estate Planning

» Chapter 2 – QUALIFIED RETIREMENT PLANS