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Decision is Consistent with Recent Florida Decision

In a unanimous decision, the Supreme Court ruled June 12th that “inherited IRAs” are not exempt from creditors (which would include the ex-spouses of our children and grandchildren of a divorce), and are not excluded as “retirement funds” exempt from creditor claims in a bankruptcy. Clark v. Rameker , 573 US ___ (2014). The case is consistent with a recent Florida decision, where the Florida Second District Court of Appeals ruled the same under Florida law. Robertson v. Deeb, 16 So. 3d 936 (Fla. 2d DCA 2009).

Mr. Kempe has been advocating the integration of retirement plans with trusts since his article, Designating Trusts as Beneficiaries of Retirement Accounts, was published in the Florida Bar Journal in 1993. See Vol LXVIII, No. 1, Florida Bar Journal, 30 (January, 1993). Without integration, the fund balances are not protected from the four “unfriendly hands:” divorce, in-law elective share rights, third party creditor claims, or federal and state wealth transfer tax systems. Proper integration, however, requires compliance with IRS regulations and oftentimes education of IRA custodians or retirement fund administrators.

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