The Problem with Naming Your Estate the Beneficiary of Your IRA – Getting Your Financial Ducks In A
While it seems to be a simple idea to just make your estate the beneficiary of your IRA, thereby allowing you to make adjustments to your final beneficiaries via your will – there is a problem that will arise if you decide to take this route. Most often this line of thinking is used because there is the assumption that the money will be treated the same via your estate as it would if you specifically named the beneficiaries on the IRA documentation.
The problem is that IRAs are (as we’ve discussed in many other posts) much different from your other assets, with special rules that apply ONLY to IRAs, and of course, those special rules extend beyond the grave.
via The Problem with Naming Your Estate the Beneficiary of Your IRA – Getting Your Financial Ducks In A Row.