Planning Potpourri

■ Roth IRA Conversions and Charity: They’re the rage. But you can do good too
while planning your conversion. ◙When converting you IRA or qualified plan to a
Roth make a donation to charity to offset much of the income tax cost generated
by the conversion. ◙ Example:
Convert over 5 years so spread the tax cost and make a corresponding charitable
gift reducing the tax.  ◙ Example:  Instead of an outright gift contribute to a charitable
remainder trust (CRT) sufficient appreciated non-IRA assets to reduce your Roth
conversion tax and increase your yearly cash flow. ◙ Example:  Combine the Roth conversion with
grandchildren as beneficiaries and life insurance held in an insurance trust
(ILIT) to provide more inheritance for your children to make up for the
converted Roth being stretched for your grandchildren. Thanks to Henry Rubin of
Yeshiva University, NYC.

■ Power Roths. Not a new kind of Roth, just a headache that
will hit some. So when you convert your IRA you first split your regular IRA
into say 5 smaller IRAs and convert each separately. Each post-conversion Roth
is invested in a different asset class. You then use hindsight on your extended
income tax return to determine which to leave converted and which to choose to
recharacterize. See Practical Planner November 2009. If you’re disabled when
recharacterization has to happen, will your wealth manager respond to your
agent? Do you have a durable power of attorney that expressly authorizes an
agent to reconvert? What does it say about naming beneficiaries? Some wealth
management firms continue to refuse to respect powers of attorney other than
their own forms. The forms we’ve seen have never expressly addressed Roth conversions.
Could this become a problem?

■ New Charity. A new charitable/educational endeavor,
RV4TheCure. See www.rv4thecure.com and
join our Facebook page (search “rv4thecure”) in Facebook. Our mission is
simple: educate professional advisers (CPAs, attorneys and financial planners)
on estate, tax and financial planning for those living with chronic illness.
Courtesy of Lorman Education Services we’ll be able to give free CPE, CLE and
CFP credits for most programs. NAPFA has joined us and is encouraging members
to host our programs around the country. AICPA-PFP division hosted a free
webinar on the topic (the podcast will be posted on www.rv4thecure.com) and will be hosting
on October a free webinar for consumers on October 6. Sample forms, power
points, planning memos and more have been posted to the website for your use.  We’re NOT asking anyone for money, just
support in spreading the word, hosting or attending programs, and using our
materials to run your own seminars for your prospective clients
so you can help us disseminate helpful planning information to the public.