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Gifts of Retirement Assets
(Gift example*)

How can you give more to your heirs with less? For the sake of simplicity, let's assume you have $300,000 in an IRA and appreciated stock worth $250,000. Assuming you are in the 41 percent tax bracket, you can see that your heirs actually benefit more from the lower valued gift of stock.

IRA to Charity

Stock to Heirs

IRA to Heirs

Value of IRA

$300,000

$250,000

$300,000

Estate tax (45%)

$0

$112,500

$135,000

Transfer to Heir

$137,500

$165,000

Less income tax (33%)

$0

$54,450

Remainder to charity/heirs

$300,000

$137,500

$110,550

Total Tax

$0

45%

63%

*This example is based on a factor that changes monthly. Contact our office for a personal illustration based on the latest rates.

What if I'm not affected by the estate tax?

The income your heirs receive from your IRA is called Income in Respect of Decedent (IRD). IRD is taxable upon transfer and at the donor's highest tax rate. However, the gift of stock is taxable when the heirs sell the shares; and then only the gain that has occurred from the date of transfer is taxable – typically at the 15 percent tax rate.

For more information

E-mail us, complete the personal illustration form or call us at (800) 395-1087 so that we can assist you through every step of the process.


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