What are the requirements that a trust needs to meet to be qualified?

By Denise Appleby AAA
A:

The requirements that a trust must meet to be qualified are as follows:

  1. The trust must be a valid trust under state law or would be except for the fact that there is no corpus.
  2. The trust must be irrevocable or will, by its terms, become irrevocable upon the death of the retirement account owner.
  3. The beneficiaries of the trust concerning the trust's interest in the retirement owner's account must be identifiable from the trust instrument.
  4. The IRA trustee, custodian or plan administrator must be provided with either a copy of the trust instrument - including the agreement that, if the trust instrument is amended, the administrator will be provided with a copy of the amendment within a reasonable time - or all of the following:

    I. A list of all the beneficiaries of the trust (including contingent and remaindermen beneficiaries with a description of the conditions on their entitlement).

    II. Certification that, to the best of the owner's knowledge, the list is correct and complete and that the requirements of (1), (2) and (3) above are met.

    III. An agreement that, if the trust instrument is amended at any time in the future, the owner will, within a reasonable time, provide to the IRA trustee, custodian or issuer corrected certifications to the extent that the amendment changes any information previously certified.

    IV. An agreement to provide a copy of the trust instrument to the IRA trustee, custodian or issuer upon demand.

This question was answered by Denise Appleby
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