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Giving a Retirement Plan to God
Tax-deferred retirement accounts, such as IRAs, 401Ks, Keogh plans, SEPs and tax-deferred annuities, allow invested funds to grow tax free until they are withdrawn-usually to support the retired account holder and his or her spouse (if applicable). Through minimum withdrawal requirements, most tax-deferred accounts are designed to be completely used up by the time of death, based on average life expectancy.
In the event that death occurs before the funds have been depleted, retirement account assets pass to others according to the instructions given by the account holder to the account administrator in the most recent beneficiary designation form.
Typically the spouse (if applicable) is the primary beneficiary, and he or she can use the retirement assets as taxable income throughout the remainder of his or her lifetime.
Any funds remaining in these accounts after both the owner and spouse have both died make an excellent gift of resources for ministries such as World In Need International. Not only are such gifts fully deductible for estate tax purposes, but gifts from tax deferred assets also completely avoid the income tax that would otherwise be due if these funds were passed on to children or other non-charitable beneficiaries. When combined with the applicable estate tax, this "income in respect of a decedent" or "IRD" tax can amount to as much as 70 percent or more of the total asset value! Those with a heart for ministry may want to use these dollars to impact eternity, and avoid losing a substantial portion of them to the government in taxes.
How is this done?
Obtain a "change of beneficiary designation" form from your account administrator, and list World In Need International on the form as the sole primary (if single) or contingent (if married) beneficiary, or as one of several ministries you care about, in whatever percentage you desire.
Include our address and phone number on the form, along with our Employer Identification Number (EIN):
World In Need International,
1420 Celebration Blvd. Suite 200,
Celebration, FL 34747
Check with your retirement account administrator to see what is needed by the beneficiary at the time of death to receive the assets, and arrange for those requirements to be met. (Sometimes a death certificate needs to be sent in by the beneficiary to a certain address. If so, arrange for a death certificate to be sent to WIN with instructions about how and where to apply for the remaining assets to be transferred).
Inform our Gift Planning Department at World In Need International of your beneficiary designation so we can thank you and make a note in our file to alert you to any address changes or other things that may affect your gift. Let us know about any instructions regarding how to receive the assets, and how you would like the assets used.
For more information:
By specifying World In Need International as a contingent beneficiary (after your spouse if you are married) or as the primary beneficiary (if you are single) of some or all of each tax-deferred account you own, you can maximize the positive effect that any dollars left in these accounts can have after you are gone.
If you have any questions or wish to start the process for your gift, please fill out the form below, or call World In Need International at 330-401-9404.
This information is designed to provide information and illustration of the subject matters covered. It is not intended, nor should it be used as legal, accounting or other professional advice. It is always a good idea to seek legal and tax advice from your professional advisor(s).