Tax-Deferred Retirement Plans

  • Make United Way Foundation the beneficiary of an IRA or other tax-deferred retirement plan.
  • Avoid income and estate taxes of up to 65%.
  • One of the simplest and most tax effective ways to make a gift.
  • Make lifetime gifts of your Required Minimum Distributions for additional tax savings and immediate impact.

Gifts from IRAs

Roger White, a widower with no children who recently turned 70, will be required to start taking Minimum Required Distributions (MRD) from his $400,000 IRA. He estimates the MRD for this year will be a little over $15,000.

Roger has never had much debt, and doesn’t even itemize his deductions, He has other assets that provide plenty of income for his needs and he doesn’t need the annual IRA distribution. He can direct his IRA custodial to transfer $15,000 directly from his IRA to the United Way Foundation as a “Qualified Charitable Distribution” (commonly called a “Charitable IRA Rollover”). The $15,000 will count as his Minimum Required Distribution and will reduce his taxable income by $15,000, thus reducing his income taxes by about $6,000 the same amount as if he had taken a charitable deduction as part of itemized deductions. Roger can do this every year going forward.

Roger also knows that his entire IRA will be subject to income taxes, when withdrawn by his heirs, in this case nieces and nephews, so he decides to make the United Way Foundation the beneficiary of his IRA and leave other non-taxable assets to his nieces and nephews.

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