Legal Question in Wills and Trusts in Illinois

No. That is not true. There is a lot of misinformation out there. Talk to a reputable professional.

Federal taxes are payable on income. If the IRA accounts are not Roth IRAs, there will be a considerable amount of tax to be paid, irrespective of whether you name an individual beneficiary or name the trust as the beneficiary (there are technical reasons why leaving IRA or other tax deferred accounts to a trust is not a good idea). In other words, if the contributions to the IRAs were tax deductible, when the beneficiary takes the money out, they will have to pay income tax. Inherited bank deposits are not income, but the interest earned on the account(s) is income. Interest on Savings Bonds is taxable to someone, either you or your beneficiary.