Leaving a Legacy

Name the church your IRA beneficiary.

You work hard, you save for retirement. You put your retirement savings into tax deferred accounts, such as your 401K or IRA. Have you given thought to how much of your savings could go to the government for taxes?

After your death, your beneficiaries will pay taxes on the value of your retirement savings at the beneficiary personís income tax rate. This can be as high as 35% for Federal income taxes plus state taxes.

Before distributions are made to your beneficiaries, other taxes may be deducted off the top depending on the size of your estate and who is named the beneficiary.

If IRA distributions go to grandchildren or more distant heirs, they may also be subject to the second kind of estate tax, the generation-skipping transfer tax.

If all these taxes apply, up to 80% of the assetís worth could go for taxes.

This taxation can be legally avoided. If you name St. Paulís as the beneficiary of your 401K or Traditional IRA, it will pass outside of your estate. No estate tax. As a tax exempt organization, St. Paulís pays no income tax. The church will receive 100% of your retirement account without any tax reduction.

You can decide how these funds are spent. Building maintenance? The Sunday School ministry? The food bank? Invest for future needs? You decide what ministry is important to you.

Itís easy to name a beneficiary. No need to change your will. Just contact your plan administrator and name your church as beneficiary to what you have remaining in your account when itís your time to go to the Lord. Your legacy will live on.

Mary Ann Jones


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