Retirement Plan Assets
Naming the Business Honors Program as a beneficiary of one or more of your retirement plan accounts is one of the easiest ways to make a planned gift. Retirement plan assets left to the BHP qualify for the unlimited estate tax charitable deduction, and they are not subject to income tax when received by the Business Honor Program.
How It Works
- Designate the Business Honors Program as the primary beneficiary for a percentage (1 to 100 percent) of your retirement plan assets.
- Designate a specific amount to be paid to the BHP before the remainder is divided among family beneficiaries.
- Make the BHP the contingent beneficiary to receive the balance only if your loved one, as primary beneficiary, doesn't survive you.
Retirement plan assets left to the Business Honors Program qualify for the unlimited estate tax charitable deduction, and they are not subject to income tax when received by the BHP. As a result, the retirement plan assets are available in their entirety. To simplify; each $100,000 in retirement plan assets you leave to the BHP, the effective after tax “cost” to your estate and heirs could be $35,000 or less.
Retirement plan assets include:
- Individual Retirement Accounts (IRAs)
- 401(k) Plans
- Profit Sharing Plans
- Keogh Plans
- 403(b) Annuity Plans
- You can escape both income AND estate tax levied on the residue left in your retirement account by leaving it to the Business Honors Program.
- Give the most-taxed asset in your estate to BHP, and leave more favorably taxed property to your heirs.
- You can continue to take withdrawals during your lifetime.
- You can change the beneficiary if your circumstances change.
Make a Gift
For information on Retirement Plan Assets, contact Dianne Bangle in the McCombs School at (512) 475-8177.