Bequest from Your Retirement Plan:

The Details

Your retirement fund can be taxed up to 80% if passed on to heirs, yet it is tax free to charity.

If the largest asset in your estate is your retirement plan, such as a 401(k), IRA or Keogh, you may be surprised to learn that the IRS will impose income tax on the remaining balance in the account if you designate it to a beneficiary other than your spouse.

This tax is in addition to the estate tax that may be imposed on the account. For estates fully subject to the estate tax, the result can be that up to 80 percent of the value of your retirement plan will be consumed in taxes before your child, relative or friend receives it.

There is a sensible charitable alternative:

Name Johns Hopkins as the beneficiary of your retirement plan, then use other assets not subject to income tax to make gifts to your heirs. Johns Hopkins, as a qualified 501 (c)(3), will not pay income tax on the distribution, and your heirs will receive their share of your estate without the burden of extra taxes.

Is this gift right for you?

A gift from your retirement account is for you if…

  • You hold a 401(k), IRA or other retirement plan.
  • You prefer to make a gift to us through your estate plan.
  • You want to balance your giving between providing for your family and for us.
  • You want to ensure the most efficient distribution of the assets in your estate.