When you set up your IRA, you need to complete a beneficiary designation form to indicate your choice as to whom you want to receive your IRA if you die prior to having withdrawn all the money in your IRA. This is an important decision with many ramifications. You need to keep your beneficiary designation up to date because life is always changing. Deaths, births, and divorces are examples of some of the changes that may affect who you want in your beneficiary designation. A mistake in your beneficiary designation can result in your IRA passing at your death to people whom you wouldn’t want to receive it or people whom you do want to receive your IRA having to pay substantially higher income taxes on the money they inherit.