Retirement Plans and IRAs

Make Taylor the beneficiary of your retirement plan or IRA

Many people have set aside money in "qualified" retirement plans. These are plans, such as IRAs, 401(k)s, 403(b)s, etc. where the money contributed to the plan was deductible. In other words, no income tax was due on the money that went into the plan. However, all money taken out of the plan will be subject to tax as ordinary income.

If a person dies with money in such a plan, the person receiving the money must pay income tax on the proceeds. If that amount is also subject to estate tax, the total taxes can be up to 90% of the face value.  

One way to avoid these taxes is to name a charity like Taylor University as the beneficiary of all or part of your retirement plan.

Charities are not subject to income tax and there is an unlimited charitable deduction from estates when calculating estate taxes. By making charitable contributions specifically from your retirement plans and passing other assets on to your heirs, both your heirs and your charities can receive more due to the tax savings.