Giving From Your Retirement Plan: The Details
Your retirement fund can be taxed up to 80% if passed on to heirs, yet if given to charity it’s tax-free. Often, between paying taxes and receiving a deduction, using a lifetime withdrawal to make a gift to charity is a “wash” for tax purposes.
Is this gift right for you?
A gift from your retirement account may be for you if…
If the largest asset in your estate is your retirement plan, such as a 401(k), IRA, or Keogh, you may be surprised to learn that the IRS will impose income tax on the remaining balance in the account if you designate it to a beneficiary other than your spouse.
This tax is in addition to the estate tax that may be imposed on the account. For estates fully subject to the estate tax, the result can be that up to 70 % of the value of your retirement plan will be consumed in taxes before your child, relative or friend receives it.
There is a sensible charitable alternative:
Name Anti-Defamation League as the beneficiary of your retirement plan, then use other assets not subject to income tax to make gifts to your heirs. Anti-Defamation League Foundation, as a qualified 501 (c)(3), won't pay income tax on our distribution and your heirs will receive their share of your estate without the burden of extra taxes.
The professionals at our Department of National Planned Giving, Legacy and Endowments will be happy to discuss your interests, concerns and financial options, and work personally with you and/or your legal and financial advisors to create a plan that meets your needs and supports the Anti-Defamation League Foundation.
For more information, please contact:
Director of National Planned Giving, Legacy and Endowments
Anti-Defamation League Foundation (ADLF)
605 Third Avenue
New York, NY 10158
This information is provided for educational purposes. The Anti-Defamation League Foundation and ADL are not financial, legal or tax advisors. Please contact your advisors regarding your financial, legal or tax needs.