Naming a trust as the designated beneficiary of a your IRA has several very important advantages over directly naming the beneficiaries. 

Thanks to tax legislation enacted in 2006 (Tax Increase Prevention and Reconciliation Act of 2005- or TIPRA) the year 2010 affords a window for converting a Traditional IRA (the earning on which will be taxed) to a Roth IRA whose earning are not taxed after a five-year holding period regardless of income and to defer the tax due.

The 2010 standard mileage rates for business purposes, and medical and moving purposes have been reduced from 2009 levels, as anticipated.

There has been much made of the fact that the House was recently successful in passing an extension of the 2009 estate tax for 2010 and later years.  BUT the Senate was unable to obtain enough votes to pass similar legislation to extend the current estate tax provisions.  This means that the federal estate tax has disappeared for deaths occurring after December 31^st; however, in 2011, the estate tax will return with a $1 million per estate exemption from tax and a Clinton-era 55 percent top rate.  By contrast, for those dying in 2009, the first $3.5 million of each estate was exempt from federal tax, and the top estate rate was 45 percent.  But there is more…