Gifts Of Retirement Assets

Careful planning for the disposition of retirement plan assets can help to avoid undesirable tax costs. In certain situations, gifts of retirement account balances to a Masonic Charity may improve the donor's overall tax consequences, increase the amounts passing to heirs, and reduce income and estate taxes.

Because qualified plan assets are generally subject to both income and estate taxes at death, a donor may want to consider giving certain qualified plan assets, including IRA assets, to a Masonic charity, while leaving certain capital assets, such as stock, to the donor's heirs.

Alternatively, a donor could establish a charitable remainder trust at his or her death to receive qualified plan assets. The trust would make payments to the donor's heirs for the lifetime of a designated person, or for a term of not more than 20 years, with the remaining assets passing to a Masonic charity at the death of the designated person or the end of the designated term.

Any income tax on the plan assets transferred to the charitable remainder trust would then be deferred until paid to the designated heirs, and the estate would receive a charitable deduction based on the remainder value of the assets passing to the designated Masonic charity.

Return to Outright Gifts.