Beneficiary for IRA/401k

[rodney_kranz]

Can someone tell me if I have this correct? As I understand it, if I have a 401k and/or IRA that is my own account that I have funded (ie not inherited), and I pass away (before age 70) - then if there is no surviving beneficiary, that the beneficiary is indeed considered my own estate, whether I explicitly name my estate as a secondary (or primary) beneficiary or not?

 

[curb1]

Why would you not name a beneficiary?

 

[Kiawah]

Rodney,
You should investigate the tax situation of inherited IRA's received via beneficiary designation, versus the taxes due if no beneficiary named and the IRA dumped into the estate.

 

[rodney_kranz]

The primary beneficiary will be my spouse. In the rare even that we decease simultaneously, then if there is no secondary beneficiary, then this is my question. I realize these accounts will get cooked regarding taxes in this case, but I think it is an unusual enough occurrence that I'll take that risk.

 

[curb1]

Why not name a secondary beneficiary? You seem to be intent on making a simple situation difficult.

 

[rodney_kranz]

Valid point, but I did not provide all of the detail. In the case in which my spouse and I decease simultaneously, I want to be sure that my children do not inherit these funds at age 18 (without having to establish some expensive trust, given such a rare occurance), therefore I establish a Children's Pot Trust in my will. The Pot Trust is only established if my spouse does not survive me. Since the trust will not exist until I pass away, then I can't name it as the secondary beneficiary for an IRA/401k, correct? Assuming that, does it sound like I will accomplish what I describe if I simply do not name a secondary beneficiary on these accounts?