Estate planning at Interactive Brokers

IBKR publishes an unusually specific list of unacceptable designations on the IRA Beneficiary Designation form, and any of them can invalidate your designation. It will not accept: naming your "Last Will and Testament" as the beneficiary; animals as beneficiaries; the word "issue" (IBKR rejects it because in its legal sense it sweeps in all lineal descendants, however remote); the words "or" and "and/or" between beneficiaries, because they do not clearly explain how assets should be distributed; and any form that has been altered or has items crossed out. Two more IRA defaults are worth knowing: if you file no designation at all, IBKR pays the IRA to your surviving spouse, or if none, to your estate — and a divorce, annulment, or other legal termination of your marriage automatically revokes a beneficiary designation naming your spouse.