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Retirement Account Assets

Current Outright Gifts

A retirement party marks the accomplishments of a lifetime.The option of making current outright charitable gifts using Retirement Plan Assets is generally not a wise alternative for donors under age 70 ½ since it requires them to take early distributions from their IRA or Retirement Plan; pay taxes due on the withdrawn amount; use the proceeds to fund their gift; and thereby incur penalties for their early withdrawals.

Deferred Gifts

For donors of any age, however, designating a favorite charity as a beneficiary of a Retirement Plan Account at your death is one of the simplest and most tax efficient methods of making bequests to qualified charities.  Since most individuals have contributed to IRAs and retirement plans on a tax deferred basis, it only means that taxes have been postponed until retirement or death. Therefore, living heirs whom you designate as beneficiaries must continue to pay federal and state income taxes due on distribution benefits they inherit.  However, charities are tax exempt meaning no taxes are owed on retirement assets passing directly to them.  So if your goal is to leave assets to both charitable organizations and family members, it is definitely a fiscally better choice to leave non-taxable assets to your heirs and fund charitable bequests with otherwise taxable assets.

Finally it is important that all individuals wishing to make retirement plan funded gifts to Global Ministries, UMCOR, or Women's Division contact the Major Gifts & Planned Giving Office by phone at 440-816-1270 or by e-mailing Barbara J. Bibbee bbibbee@gbgm-umc.org  to obtain necessary forms and detailed information regarding exact procedural steps required for successful completion of your tax-advantaged gifts.

The information above is not intended to be legal, tax, or investment advice. So please consult your attorney and/or personal financial advisor to obtain this information.