Epic Real Estate Investing - Why Your IRA Isn't Protected in the Way You've Been Told It Is | 557

Episode Date: January 1, 2019

Today, we are giving you the reasons to stay informed and be aware of the new bills and the new laws that set the IRAs up for grabs and make them available to the creditors. Stay with us and learn what it means when we say that the retirement accounts are exempt and why your IRA isn’t protected. Learn more about your ad choices. Visit megaphone.fm/adchoices

Hey, happy new year on behalf of the Epic team and myself, 2019, it's going to be your year. I got no doubts about it. And I plan to make a big for myself as well as I'm putting together a tiny dream team of rock star real estate investors. And if you'd like to join me, it begins with three full days where I'm going to work with you personally on your real estate investing business. And I'm going to do that for free to get you all set up to make 2019 your greatest year ever. Now, this isn't open to the public.

It's by invitation only. So if you'd like to join me, go to dreamteaminvitation.com. All the details are there. Dreamteaminvitation.com. This is Terrio Media. Did you know that up to 50% of your lifetime income will be wiped out by taxes? What if you could stop this madness? Isn't it about time you play on a level playing field with the wealthiest 1%?

Now you can. Tim Berry, attorney at law, shares here each and every week, current tactics and strategies that anyone can implement to hack the tax code. Protect your assets and keep what's rightfully yours. It's time for Tax Hacker Tuesday. I am Bernie Gartland, tax attorney, and Tim Berry, tax attorney. So Tim says to me, you know, we ought to talk to the folks about an IRA. And I said, Tim, why are we talking about an IRA?

everybody knows that it's a retirement account. Everybody knows you put money into it. Everybody knows it's protected in bankruptcy. It's protected in judgments. So why in the heck are we even bringing up something that is already established? But that's it, Bernie. It's not established. Let's rephrase that.

It just got established. You love that softball I just gave them? It just became established. June 12th, the Supreme Court looked at a situation where mom had passed away and left an IRA over to their kid. Their kid, you know, ran in some financial situations and declared bankruptcy. Well, as a general rule of thumb, how are IRAs treated in bankruptcy? They're exempt.

They're exempt. And what's that mean? What it means that the trustee in bankruptcy can't climb onto it to liquidate it to give the funds to the creditors. They're exempt. You can go home with your IRA. So I could have a couple hundred thousand dollars in my IRA, declare bankruptcy, and they can't touch it? That is, I think you're going to tell us otherwise, though, today, aren't you? Well, no, no, no.

For a true IRA, they're still exempt assets. They're exempt assets. But in front of the U.S. Supreme Court, the question was this. Are inherited IRA's retirement plans such that they should be considered exempt assets? And whenever the gavel banged down, what are wonderful justices say in a unanimous? By the way, unanimous decision. And what did they say? This is the United States Supreme Court.

And what they said is inherited IRAs do not have the protection of exemption. They aren't exempt assets and bankruptcy. And so let's stop and think this through. You've worked really tough your whole life. You've built up a fairly large IRA. And now most people, they don't really want to use the income from the IRA for their living purposes. They see that as a tool to pass on to the next generation. So you want to pass this on to the next generation.

The problem is with this U.S. Supreme Court ruling, whenever that money is passed, passed over to the next generation, it's up for grabs. It's in play. It's no longer exempt. So you need to take steps to protect that money. In other words, every tax attorney that does a state and wealth preservation and planning and certified public accountants and also financial advisors, better read this United States Supreme Court decision because it caused for a complete revamping of your mindset for protection of what mom and dad want to leave to their children. Do you agree with that? Oh, I totally agree. And it comes down to, it can still be done. You can still leave the assets

to the next generation with no taxes. You can still stretch it out during the rest of their lifetime, and you can still have asset protection, but you have to take some different steps. And this is really timely too, because the new tax bill, the highway bill, Bernie, what are they talking about inside the highway bill? What are they talking about? We tell me what they're talking about. We tell me what they're talking about in a highway bill. They're talking about once again that in the past, you can stretch out the IRA over the next generation lifetime with this highway bill. What about, do they have a five-year requirement? Exactly. They're going to limit to five years. They're going to say that the IRAs have to be distributed within five years. There's a chance that

they're going to change that around, but you've got to be aware of the new bills and the new laws to be planning for this stuff as well. So long story short, if you've built up an IRA, you need to take a lot of protections to make sure that's passed on to the people you want it to. Otherwise, it could go to their creditors. That's it for today as we dream of a tax system that works just for you. But until then, you have Tim Berry. See you next Tuesday for another episode of Tax Hacker Tuesday. This podcast is a part of the C-Suite Radio Network.

For more top business podcasts, visit c-sweetradio.com. Thank you.