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 457 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] Non-Annuity Distributions to Beneficiaries
• ———-[a] Non-Annuity Distributions Generally
• ———-[b] Non-Annuity Distributions for Different Classes of Beneficiaries
• ———-[c] Non-Annuity Distributions to Eligible Designated Beneficiaries (EDBs)
• ———-[d] Distributions to EDBs under the Ten-Year Rule
• ———-[e] Distributions to EDBs under the Life-Expectancy Rule
• ———-[f] When Spouse Is the Sole Beneficiary (Sole EDB)
• —————[i] Spouse’s Choice of Distribution Method
• —————[ii] Death in Calendar Year Before Attaining Age 62
• —————[iii] Death in Calendar Year Attaining Age 62 or Subsequent Years
• —————[iv] Distribution Computed by Annually Redetermining Life Expectancy
• —————[v] The Surviving Spouse’s IRA Ownership Option
• —————[vi] Spouse Dies Before Minimum Distributions Required
• —————[vii] Qualifying the Surviving Spouse as the Sole Beneficiary
• ———-[g] When Spouse Is Not the Sole Beneficiary
• —————[i] EDB’s Choice of Distribution Method
• —————[ii] Comparison of Distribution Methods
• —————[iii] Distribution Based on Life Expectancy in the First Distribution Year
• —————[iv] Special Rules for Beneficiary Rollover from Qualified Plan to IRA
• ———-[h] Ten-Year Distributions to an IBD or the Beneficiary of an EBD
• ———-[i] Distributions to Nondesignated Beneficiaries (NDBs)
• ———-[j] Use of Trusts to Provide for Beneficiaries
• —————[i] Trust Are Generally Nondesignated Beneficiaries
• —————[ii] Designated Beneficiary Exception for See-Through Trusts
• —————[iii] Use Conduit Trusts
• —————[iv] Use of Accumulation Trusts with Identifiable Beneficiaries
• —————[v] Use of Powers of Appointment
• —————[vi] Applicable Multi-Beneficiary Trust (AMBT)
• —————[vii] Separate Accounts, Separate Trusts, and Subtrusts
• —————[viii] Spray Trust as Beneficiary of a Tax-Favored Plan
• ———-[k] Planning with Trust Accounting Rules
• —————[i] Special Allocations of Different Classes of Trust Income to 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
• ———-[l] Trusteed IRA as Alternative to Naming Trust as Beneficiary
• ———-[m] Distributions in Excess of Required Minimum Distributions
• ———-[n] Placing Benefits to Surviving Spouse in Trust
• ———-[o] Use of Charitable Remainder Trusts
• —–[3] Annuity Distributions to Beneficiaries
• ———-[a] Annuity Distributions Generally
• ———-[b] Meeting Initial Minimum Distribution Requirements for Annuities
• ———-[c] Requirements Applicable to Lifetime Annuities
• ———-[d] Payments to Younger Nonspouse Beneficiary
• ———-[e] Life Annuity and a Period Certain
• ———-[f] Exceptions Allowing Annuity Payments that Increase over Time
• ———-[g] Changing the Annuity Payment Period
• ———-[h] Separate Shares for Two or More Beneficiaries
• ———-[i] Annuity Distributions by Traditional Defined Benefit Plans
• ———-[j] Annuity Distributions by Defined Contribution Plans
• —–[4] Community Property Interests: Spouses and Registered Domestic Partners
• —–[5] Use of Disclaimers in Post-Mortem Tax Planning
• —–[6] Designation of Charity as a Beneficiary
• —–[7] Advantages of Personally Purchasing an Annuity
• —–[8] Beneficiary Elections for Unfunded Nonqualified Plans
• —-[9] Rollover of Military Death Gratuities and Life Insurance Proceeds
• —-[10] National Guardsmen or Reservists Dying or Injured on Active Duty
• —-[11] 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