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A Bequest to Save Taxes

A Bequest to Save Taxes

Kim was a widow who had a great love for United Methodist Women. As an individual who had directly benefited from our work, Marta wanted to thank us with a gift from her estate.

Kim told her attorney that she wished to make a bequest to her favorite charity. Kim's estate included some stocks, real estate and an IRA. Kim's attorney recommended that she give the appreciated stock and real estate to her children and leave her IRA to charity.

Kim: My attorney told me that if I gave the stock and real estate to my children, these assets would receive a step-up in basis at my death. My children could then sell them without paying tax. However, if I gave my children my IRA, the IRA would be subject to estate and income tax. After paying all of these taxes, very little would be left for my family. By giving the IRA to United Methodist Women, I could make a nice gift and avoid any additional tax for my estate and children.

Kim contacted her IRA custodian to obtain a beneficiary designation form. She filled out the form and designated United Methodist Women as the 100% recipient of her IRA account. Kim's attorney then specified in Kim's will the bequest of her other assets to her children.

Kim: I was so impressed with my attorney's advice that I named him executor of my will!

Kim called and notified us of her bequest. Kim was pleased that because United Methodist Women was a tax exempt institution, it would receive the full amount of the IRA value when she passed away, creating a legacy for the future.

You also may want to make it easy and convenient to have a bequest included in your will. The language found at this link shows how a bequest can very easily be included in your will.

Click Here to review sample bequest language.

You might find it helpful to select the "print" button on the top of your screen and print these pages. You may feel free to give these pages to your attorney. If he or she has any questions, please have him or her contact us at 212-870-3741 or NEpps@unitedmethodistwomen.org.

*Please note: The name and image above is representative of a typical donor and may or may not be an actual donor to United Methodist Women.

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