Table: Bad News, Good News
You're dead, that's the bad news. But your leftover retirement fund need not be lunch for the taxman:
The IRS now allows for longer life expectancies. That means those who must withdraw from their retirement accounts each year can, if they wish, take less each year and thus leave more for their heirs.
Instead of three different ways to compute life expectancy, the new rules offer just one.
INHERITANCES THAT LAST LONGER
Whoever is the designated beneficiary on Dec. 31 of the year following the account owner's death can spread annual withdrawals over his lifetime. In the past, heirs often were stuck completing the account owner's life expectancy.
THE ELIMINATION OF PAST MISTAKES
You can wipe the slate clean on IRA distribution choices that were not optimal or no longer suit your needs.
Account owners can change beneficiaries as often as they like with no negative repercussions for heirs.