A very effective way to fund a charitable gift, whether during your life or at death, is with retirement plan assets. Below are brief explanations of methods you could employ to preserve more of your retirement-plan assets for your loved-ones and for a charitable organization like the Bob Jones University Museum & Gallery.
Provide for your spouse and
M&G
With a charitable remainder trust you can use your retirement-plan
assets to provide an income for your spouse after your death and then give
the remaining benefits to the Bob Jones University Museum & Gallery. By
establishing a charitable trust now with your spouse as payment beneficiary
and M&G as the remainderman, your retirement-plan assets would
be paid to the trust at your death and your spouse would receive a stream
of payments for life. Your spouse's payments would be based on the payout
rate you selected when the trust was established. At the end of your spouse's
life, the trust will terminate and its principal will be paid to M&G.
With such an arrangement, no estate tax is payable because the trust qualifies
for both charitable and marital deductions. In addition, because the charitable
trust is a tax-exempt entity, no income tax is assessed to assets transferred
to the trust. Of course, payments to your spouse from the trust will be taxed
at his/her applicable tax bracket.
Provide for your children
and M&G
Funding a charitable remainder trust at your death with retirement-plan
assets can also be an effective way to provide for surviving children, reduce
taxes, and make a gift to M&G. The trust would be written to name
your surviving children as beneficiaries, with M&G as the remainderman.
The total benefits received by your children from the trust may be greater
than if you had simply left your retirement funds as a lump sum to them. And,
in addition, you provide a nice gift to M&G.
Outright gifts to
M&G
If you, your spouse, or your children do not need the income from
a charitable remainder trust, you may want to consider giving all or part
of your retirement-plan assets outright to M&G. Assets remaining
in your retirement plan at death are subject to estate and income taxes. If
you desire to make a charitable gift, you may want to consider making a withdrawal
from your retirement plan and contributing it to M&G. The charitable
deduction you would receive for the gift may offset the income tax incurred
from the withdrawal.
Gifts at death
to M&G
Another way for you to make a gift to M&G from your retirement-plan
assets is simply to give us all or a portion of your retirement funds at death.
This gift will avoid all taxes, and the cost of such a gift may be as little
as 20 cents on the dollar.
It is our desire to help you determine which of these methods may be best for you and your family. We welcome the opportunity to provide you with additional information about any of these methods and to discuss with you how you might consider making your gift. Please call us at 1-888-870-8161.
The information provided here is not legal tax advice. Please consult with your professional advisors about estate planning strategies applicable for your specific situation.
