Estate Gifts - Retirement Plans
If you are planning to leave an asset to Cedarville University after you die, a tax deferred savings plan, such as an IRA (Individual Retirement Account) or a 401(k), is an excellent choice. Unlike your family, Cedarville University will pay no income taxes when it receives the money. Naming Cedarville as beneficiary of your IRA or 401(k) will remove the asset from your taxable estate when you die, reducing or eliminating the amount your family may have to pay in estate taxes.
The Treasury Department has just issued new IRA distribution rules that make it easier for you to leave all or part of an IRA to Cedarville University or to a charitable trust for the benefit of your heirs. The new rules have been simplified and tend to reduce the amount of the minimum distribution required at age 70 � leaving more in the IRA account for eventual gifts to family and charity.
You should seek professional assistance to determine the best use for your IRA and the best method to make distributions to your heirs.
Example
Mr. Nobel, 62, has always been conscientious about putting away money for retirement. He has accumulated a substantial sum.
After the premature death of his wife, he realizes that his retirement funds have grown to a point beyond his probable need. By consulting with his advisors, Mr. Noble learns that it will be better from a tax-planning perspective to leave other property to his children and make his gifts to Cedarville from his retirement accounts, should there be amounts left at his death.
He is also surprised to learn that his retirement savings can be a convenient source from which to fund his present gift commitments as well.
We are grateful for those who have elevated Cedarville to "family status" as an heir in their estate plans. If you are one of these special individuals, we invite you to join The William Gibson Society, allowing us the opportunity to say "thank-you."
