Retirement Plan Gifts

New legislation signed into law in August, 2006, allows you to contribute up to $100,000 from IRA accounts without incurring any tax on the withdrawal. This is only effective for tax years 2006 and 2007.

Generally, the undistributed balance of qualified retirement plans is fully includable in your gross estate for estate tax purposes. Since the funds in retirement accounts usually represent deferred compensation that has not been subject to income tax, giving the accounts to individual heirs can expose the funds not only to estate taxes, but also to income taxes-at a combined marginal rate that could rise to 65 percent or even higher on large, taxable estates. The result? Your retirement dollars can be seriously depleted by this double taxation.

To preserve your retirement assets after your lifetime, consider the benefits of using them in a completely different way: through a carefully planned charitable gift.

The simplest way to leave the balance of a retirement account to Drayton Hall is to list us as the primary or secondary beneficiary or to designate a specific amount to give to Drayton Hall on the form provided by your plan administrator.

Another possibility that presents potential tax benefits is to transfer any retirement assets that remain at your death to a tax-exempt deferred giving plan, such as a charitable remainder unitrust or a charitable remainder annuity trust. With such deferred gifts, you may designate a beneficiary who will receive an income for life, either a fixed percentage of the value of the trust assets as revalued annually or a fixed dollar amount. Then at the death of the surviving beneficiary, the remaining principal would pass to Drayton Hall. In this way, your retirement funds can benefit your family and Drayton Hall's long-term preservation needs.