Retirement Plan Beneficiary

Retirement plan benefits are taxed substantially when transferred to anyone other than a spouse. Since income taxes have not been collected on these plans, transferring benefits can create an income tax liability. If the estate is large enough to be subject to estate taxes, an additional tax may be generated, which, when added to the income tax, could reduce the size of the gift by 60-70%.

Since the Ice Age Trail Alliance is tax-exempt, retirement plan assets left to the Alliance avoid both income and estate taxes. Most professional advisors suggest that if you want to leave estate assets to charity, using retirement plan dollars is a wise choice.

Example: Martha Smith was never married and has retirement income of social security, a small pension and an IRA account of $125,000. While she needs the income from all of these sources during her lifetime, the IRA may have value after her death. A simple change of beneficiary to the Ice Age Trail Alliance would provide a legacy gift for whatever value remained in her IRA account following her death.

For more information, please contact Luke Kloberdanz at [email protected] or (608) 798-4453 ext 226 or Mike Wollmer at [email protected] or (800) 227-0046.