IRA Maximization Strategies for 2024

By Alan Friedman

January welcomes us with the beginning of the New Year and offers a great time to start the discussion of a 2024 tax strategy. Have you considered offering IRA Maximization strategies to your clients?

It is well known that required minimum distributions first start when you reach age 72 (73 if you reach age 72 after Dec. 31, 2022).  For clients with “live on” and “leave on” assets, wealth transfer planning can be done to create tax efficiency and maximize legacy planning.   The three common IRA Max strategies are:

• Legacy Enhancement

• Tax Elimination

• Tax Off Set

 Attached you will find the following

• information from Protective Life that explains the concept for each strategy.

• An IRA Max illustration Case Study from Protective Life (one of the best in the industry) detailing the Legacy Enhancement Strategy for a client who would like to leave his 500k IRA to his children.

  • This strategy uses the IRA Required Minimum Distribution (RMD) to purchase the maximum amount of life insurance.  The after-tax RMD distribution of $17,500 will purchase $453,246 of death benefit using Protective’s Indexed Choice UL, on top of the $263,563 after-tax legacy from the IRA, for a total legacy of $716,809. The IRA max strategy more than doubles the amount of money he can leave to his heir.

Now is the time to identify your clients with IRA “leave on” assets and show them how the Legacy Enhancement Strategy can more than double their wealth transfer. 

 If interested in more information or to discuss a potential case please don’t hesitate to reach out to your marketing representative today.