Common use of Eligible Designated Beneficiary Clause in Contracts

Eligible Designated Beneficiary. Eligible designated beneficiary status is determined on the date of your death. The following types of designated beneficiaries generally qualify as “eligible designated beneficiaries”: your spouse, a disabled individual (as defined under Code section 72(m)), a chronically ill individual as defined in Code section 401(a)(9)(E)(ii)(IV), your minor child, and an individual who is not more than 10 years younger than you. An eligible designated beneficiary may elect (in accordance with Treasury Regulations) between the 10-year rule and life expectancy payments. A minor child ceases to be an eligible designated beneficiary as of the date the child reaches the age of majority and must subsequently withdraw the remainder of his or her interest in the Inherited IRA within a 10-year period after reaching the age of majority. In addition to the 10-year rule and life expectancy payment options, your spouse beneficiary of your IRA may, in accordance with the Treasury Regulations, take your IRA as his or her own IRA. Additional restrictions may apply. Non-Eligible Designated Beneficiary (Individual). Your IRA beneficiary(ies) who are individuals but are not considered eligible designated beneficiaries must generally withdraw inherited IRA assets in accordance with the Treasury Regulations under the 10-year rule. Nonperson Beneficiary. Your nonperson IRA beneficiaries (e.g., estates or charities) must generally deplete the Inherited IRA according to the 5-year rule if you die before your required beginning date, and must generally take life expectancy payments (in accordance with the Treasury Regulations) if you die on or after your required beginning date. Trust Beneficiary. Your trust beneficiaries must deplete the Inherited IRA in accordance with the Code and Treasury Regulations. Trustees of a trust named as an IRA beneficiary are strongly encouraged to seek assistance from a competent tax or legal advisor. Required Distributions Waiver. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), distributions required to be withdrawn in 2020 by your beneficiaries are waived. The federal government may further modify or temporarily suspend required distributions under certain circumstances, such as extreme economic conditions or other national emergencies. CUSTODIAN NOT YOUR ADVISOR UMB Bank, n.a., UMB Distribution Services, LLC, Grand Distributions Services, LLC, and UMB Fund Services, Inc. expressly disclaim any right, duty, authority or responsibility to furnish legal or tax advice relating to your IRA, including but not limited to present or future tax consequences to you or others which may result from the establishment or maintenance of the Custodial Account, the permissible amounts or deductibility of contributions, the effect of withdrawals, the selection of payment options or beneficiaries, any matters pertaining to prohibited transactions, and any other matter whatsoever. You are advised and encouraged to consult with professional counsel of your own selection respecting all such matters.

Eligible Designated Beneficiary. Eligible designated beneficiary status is determined on the date of your death. The following types of designated beneficiaries generally qualify as “eligible designated beneficiaries”: your spouse, a disabled individual (as defined under Code section 72(m)), a chronically ill individual as defined in Code section 401(a)(9)(E)(ii)(IV), your minor child, and an individual who is not more than 10 years younger than you. An eligible designated beneficiary may elect (in accordance with Treasury Regulations) between the 10-year rule and life expectancy payments. A minor child ceases to be an eligible designated beneficiary as of the date the child reaches the age of majority and must subsequently withdraw the remainder of his or her interest in the Inherited IRA within a 10-year period after reaching the age of majority. In addition to the 10-year rule and life expectancy payment options, your spouse beneficiary of your IRA may, in accordance with the Treasury Regulations, take your IRA as his or her own IRA. Additional restrictions may apply. Non-Eligible Designated Beneficiary (Individual). Your IRA beneficiary(ies) who are individuals but are not considered eligible designated beneficiaries must generally withdraw inherited IRA assets in accordance with the Treasury Regulations under the 10-year rule. Nonperson Beneficiary. Your nonperson IRA beneficiaries (e.g., estates or charities) must generally deplete the Inherited IRA according to the 5-year rule if you die before your required beginning date, and must generally take life expectancy payments (in accordance with the Treasury Regulations) if you die on or after your required beginning date. Trust Beneficiary. Your trust beneficiaries must deplete the Inherited IRA in accordance with the Code and Treasury Regulations. Trustees of a trust named as an IRA beneficiary are strongly encouraged to seek assistance from a competent tax or legal advisor. Required Distributions Waiver. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), distributions required to be withdrawn in 2020 by your beneficiaries are waived. The federal government may further modify or temporarily suspend required distributions under certain circumstances, such as extreme economic conditions or other national emergencies. CUSTODIAN NOT YOUR ADVISOR UMB Bank, n.a., UMB Distribution Services, LLC, Grand TAX WITHHOLDING Distributions Services, LLC, and UMB Fund Services, Inc. expressly disclaim any right, duty, authority or responsibility to furnish legal or tax advice relating to from your IRA, including but except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not limited to present have withholding apply to your IRA distribution in most cases. If you elect not to have withholding applied, or future if you do not have enough federal income tax consequences withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you or others which contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may result from avoid the establishment or maintenance penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Pub. 590-A and your tax advisor. The net income must be included in your taxable income. If you are under the age of the Custodial Account59½ and do not qualify for an exception, the permissible amounts net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by redesignating the amount to a subsequent year. To redesignate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or deductibility claimed as a nondeductible contribution on Form 8606. Regardless of contributionswhich method you use to correct the excess after your tax return due date, plus extensions, the effect of withdrawals, 6% penalty is required for each year it remained in the selection of payment options or beneficiaries, any matters pertaining to prohibited transactions, and any other matter whatsoever. You are advised and encouraged to consult with professional counsel of your own selection respecting all such mattersIRA.

Eligible Designated Beneficiary. Eligible designated beneficiary status is determined on the date of your death. The following types of designated beneficiaries generally qualify as “eligible designated beneficiaries”: your spouse, a disabled individual (as defined under Code section 72(m)), a chronically ill individual as defined in Code section 401(a)(9)(E)(ii)(IV), your minor child, and an individual who is not more than 10 years younger than you. An eligible designated beneficiary may elect (in accordance with Treasury Regulations) between the 10-year rule and life expectancy payments. A minor child ceases to be an eligible designated beneficiary as of the date the child reaches the age of majority and must subsequently withdraw the remainder of his or her interest in the Inherited IRA within a 10-year period after reaching the age of majority. In addition to the 10-year rule and life expectancy payment options, your spouse beneficiary of your IRA may, in accordance with the Treasury Regulations, take your IRA as his or her own IRA. Additional restrictions may apply. Non-Eligible Designated Beneficiary (Individual). Your IRA beneficiary(ies) who are individuals but are not considered eligible designated beneficiaries must generally withdraw inherited IRA assets in accordance with the Treasury Regulations under the 10-year rule. Nonperson Beneficiary. Your nonperson IRA beneficiaries (e.g., estates or charities) must generally deplete the Inherited IRA according to the 5-year rule if you die before your required beginning date, and must generally take life expectancy payments (in accordance with the Treasury Regulations) if you die on or after your required beginning date. Trust Beneficiary. Your trust beneficiaries must deplete the Inherited IRA in accordance with the Code and Treasury Regulations. Trustees of a trust named as an IRA beneficiary are strongly encouraged to seek assistance from a competent tax or legal advisor. Required Distributions Waiver. Pursuant to the Coronavirus Aid, Relief and Economic Security Act of 2020 (CARES Act), distributions required to be withdrawn in 2020 by your beneficiaries are waived. The federal government may further modify or temporarily suspend required distributions under certain circumstances, such as extreme economic conditions or other national emergencies. CUSTODIAN NOT YOUR ADVISOR UMB Bank, n.a., UMB Distribution Services, LLC, Grand TAX WITHHOLDING Distributions Services, LLC, and UMB Fund Services, Inc. expressly disclaim any right, duty, authority or responsibility to furnish legal or tax advice relating to from your IRA, including but except certain transfers or any recharacterization, are subject to 10% federal income tax withholding. You may elect in writing not limited to present have withholding apply to your IRA distribution in most cases. If you elect not to have withholding applied, or future if you do not have enough federal income tax consequences withheld from your IRA distribution, you may be responsible for payment of estimated tax. You may be subject to penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. In addition to federal income tax withholding, distributions from IRAs may also be subject to state income tax withholding. CORRECTION OF EXCESS CONTRIBUTIONS Any amount you or others which contribute for a tax year that exceeds the allowable contribution amount is an excess contribution and subject to a 6% penalty tax each year it remains in the IRA. You may result from avoid the establishment or maintenance penalty tax if you remove the excess contribution along with the net income attributable to the excess before your tax return due date, plus extensions. For assistance in calculating the net income attributable to an excess contribution using an IRS-approved method, refer to Treasury Regulation 1.408-11, IRS Publication 590-A and your tax advisor. The net income must be included in your taxable income. If you are under the age of the Custodial Account59½ and do not qualify for an exception, the permissible amounts net income is also subject to the IRS 10% premature distribution penalty. File IRS Form 5329 to pay any penalty taxes. To correct an excess contribution after your tax filing due date (plus extensions), you may withdraw the excess amount (no earnings need to be withdrawn.) Alternatively, if you are eligible to contribute in a subsequent year, you may correct the excess amount by re designating the amount to a subsequent year. To re designate a contribution, you under contribute in a subsequent year and claim the original contribution amount when you file your income taxes for that subsequent year. The original amount is either deducted on Form 1040 or deductibility claimed as a nondeductible contribution on Form 8606. Regardless of contributionswhich method you use to correct the excess after your tax return due date, plus extensions, the effect of withdrawals, 6% penalty is required for each year it remained in the selection of payment options or beneficiaries, any matters pertaining to prohibited transactions, and any other matter whatsoever. You are advised and encouraged to consult with professional counsel of your own selection respecting all such mattersIRA.