Giving Your IRA to Loved Ones? Think Carefully
While IRAs are excellent vehicles for accumulating assets for your use during retirement, much to many people's surprise, they are a far less attractive way to pass an inheritance to loved ones. Here's why.
The Tax Consequences of IRAs
When you name anyone other than your spouse as beneficiary of an IRA—or retirement plan—these assets will be exposed to heavy taxation, leaving less for your heirs than you had hoped. Upon your death, the income tax bill can take as much as 39.6 percent, and that percentage can be even higher if your estate is subject to estate taxes.
A Tax-Smart Way to Support Memorial Sloan Kettering
If you've thought about contributing to MSK, consider giving IRA assets to us and giving other assets that are not as heavily taxed to family members. As a nonprofit organization, we are tax-exempt, so we can use 100 percent of your IRA contribution to help us work toward the progressive control and ultimate cure of cancer long after you're gone.