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If your estate planning goals have changed over time and you now wish to make charitable donations, using your retirement assets to fund those bequests may be an excellent choice. Retirement assets are often some of the most highly taxed assets in an estate. By changing your beneficiary designations to name a charity beneficiary, you may minimize the tax burden on your family as well as the charity that is the recipient of the gift.

Using Retirement Assets for a Charity Beneficiary

While using retirement assets to make charitable donations can be an advantageous choice, you should first discuss the decision with your estate planning attorney. Following are three helpful tips for using your retirement accounts to make charitable donations:

  1. Ensure that your beneficiary designations are updated to list your charities of choice. If you do not update the beneficiary designations, your retirement assets may pass to parties you would not have chosen. Further, the assets could be tied up for a longer period than is desirable since the account may have to pass the probate process in Orange County or another California court.
  2. If you are married and want to name a charity as your beneficiary rather than your spouse, you may need to have your spouse sign a written consent.
  3. Understand that qualified retirement plans may have unique features and rules that vary from plan to plan. Therefore, it is crucial that you consult with your plan’s administrator.

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