IRA Beneficiary
32. Plan That Either Spouse Could Die First
Start by trying to divide your assets as evenly as possible. Look first for any separately owned assets. Then you may need to retitle some jointly owned assets to make sure your shares stay separate after you die. If you still own more than your spouse, consider transferring some assets to your spouse now. But be very careful when you start swapping assets; you could regret this decision later if you and your spouse were to divorce.
Next, you can use contingent beneficiary designations and disclaimers, and let the surviving spouse make planning decisions after one spouse dies. For example, you could name your spouse as first beneficiary of your IRA and your trust as second beneficiary. If you die first, your spouse could decide whether to use the spousal rollover option to save income taxes, or to disclaim (refuse) some of all of your IRA so it could go into your trust and use your estate tax exemption.
Third, it's very important to evaluate both the income and estate tax consequences of all your options. Sometimes it makes sense to split a large IRA in order to fully use the estate tax exemption and get the spousal rollover option on part of it. And sometimes it makes more sense to name the spouse as first beneficiary of the entire IRA, even at the expense of having to pay estate taxes - because the expected tax-deferred growth resulting from the spousal rollover and stretch out will more than make up for the amount paid in estate taxes.
Even with all the planning options available, be prepared that you may not be able to get everything you want. In some situations, especially if most of the assets you and your spouse own are in YOUR tax-deferred plans, there just isn't much you can do - except hope you die first!