Does the fine print regarding contingent beneficiaries of an IRA policy take precedent over a Will?
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Does the fine print regarding contingent beneficiaries of an IRA policy take precedent over a Will?
My grandmother’s Will states that half of her assets should pass to her daughter and half to her son (my father), and to their children if either precedes her in death. My father did precede her in death and now my aunt (the other beneficiary) is the executor of the estate. My grandmother had an IRA that was do be paid equally to her children but the policy states that if either of them precede her in death the interest of his or her heirs shall terminate completely and the % share of any remaining beneficiaries shall be increased on a pro rata basis. Does the Will or policy prevail?
Asked on October 25, 2011 under Estate Planning, Iowa
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
Good question. A Will speaks upon the death of the person who wrote the Will. If the IRA of your grandmother was in the name of your deceased father and his sister (your aunt) the children of your father inherit his portion of the IRA since they survived him as stated clearly in the terms of your grandmother's Will.
The policy in the IRA should not be able to dictate how a beneficiary under an IRA is to be when the designated person passes away and the Will of the person who owns the IRA speficially states who steps up in place of your deceased father.
In short, the Will of your grandmother controls the division of the IRA account.
Good luck.
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