Retirement assets
Relatively few people think of retirement assets—that is,
assets held in qualified retirement plans and individual retirement accounts
(IRAs)—as tools for giving to MIT. In fact, these can be flexible
and useful assets in a larger philanthropic strategy. Changes in federal
regulations have made it possible to name MIT as a beneficiary of an
IRA or qualified retirement plan, as part of your family’s overall
financial plan.
Please contact us if you would like to discuss a gift
of retirement assets to MIT.
Case study: Gifting retirement assets
Anthony Luciani, an MIT alumnus and a widower, is in the process of
estate planning. His will divides his estate between his son,
Joseph, and MIT. Along with his other assets, Luciani has an individual
retirement account (IRA) worth $300,000. He names MIT as beneficiary
of the IRA and passes his other assets to his son.
Joseph (Joe) Luciani is in the 33 percent tax bracket. If his father
were to pass his IRA outright to Joe, the amount remaining after income
taxes would be reduced by one-third, to $200,000. If Joe took out the
minimum annual distributions from the IRA, they would be subject to income
tax when he received them. But, since MIT is a tax-exempt organization,
the Institute will not be subject to income taxes on the IRA
distributions.
With this gift of retirement assets to MIT, Anthony Luciani has—
- avoided estate tax and income tax on his IRA, and
- given 100 percent of his IRA assets to support MIT’s mission.
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