Gifts of Retirement Assets - Giving the Bad Assets Away
For many of us, the accumulation of retirement assets in 401k plans and IRAs has made it possible to retire.

But there is a problem.

Because the money you put into the plan was tax-deductible, your estate will have to pay income tax on the balance when you pass away. In addition, if your estate is over $1,500,000, it will incur estate tax as well. This could mean double taxation of retirement plan assets. Not a good thing.

For many people, the idea of paying more in taxes than is necessary is not right. You worked hard to earn and invest that money, only to have it taxed after you aren't here to protect it any longer.

The Solution: Give away the bad assets.

By bad assets we mean those assets that would cost your estate the most to keep. By leaving qualified retirement plan funds to your favorite charitable organizations, you eliminate the income tax by creating a tax deduction.

By designating the Union Rescue Mission as a beneficiary (it can be a contingent beneficiary after the death of a spouse) funds pass to URM free of taxes. It is possible to set up the beneficiary as the recipient of the entire remaining funds in the account or establish a percentage to fund the bequest.

Please note - the designation of any charity as a beneficiary of retirement fund assets cannot be simply written in your will or trust. The charity must be designated as a beneficiary of the retirement plan.

Everyone's personal circumstances are different, so please consult your tax advisor concerning the use of qualified retirement funds. We would be glad to make suggestions that could be effective in accomplishing you and your family's needs and benefit Union Rescue Mission as well.

Please note, individual financial circumstances will vary. The information on this site does not constitute legal or tax advice. Donor stories and photographs are for purposes of illustration only. As with all tax and estate planning, please consult your attorney or estate specialist. All material is copyrighted and is for viewing purposes only. Use of this site signifies your agreement with the terms of use. The content in this Ministry Support section has been developed for Union Rescue Mission by John R Frank Consulting Group, Inc. Please report any problems to webmaster.

Revised: July 27, 2005