Mark Nunez, 75, is a retired business executive who has accumulated $500,000 in the retirement plan that he set up through his company years ago. He takes minimum distributions from his plan in order to preserve as much tax-free growth inside the plan as he can. At this rate, he expects that his account may still be worth $500,000 when he dies.

Mark has reached the time in his life when he has begun thinking about the legacies he wants to leave behind after he is gone. He decides to leave a bequest to Westminster Ingleside Foundation to create an endowed fund that will perpetuate generous support in his name. To accomplish his goals, he designates 40% of the final balance in his retirement account for Westminster Ingleside Foundation.


  • There will be no income tax or estate tax on the 40% of Mark's retirement plan assets that are transferred to Westminster Ingleside Foundation.
  • Assume the balance in Mark IRA when it ends is $500,000 and he donates 40% of that balance ($200,000) to Westminster Ingleside Foundation.  If Mark were to pass the same amount to his family, that distribution would be subject to ordinary income tax. His family would owe income tax of $74,000 (37% bracket) on the IRA assets, leaving only about $126,000 for their own use. If Mark’s estate is subject to estate tax the tax savings would be even greater since his estate would be entitled to an estate tax charitable deduction of $200,000.  
  • Mark has the immediate satisfaction of knowing that he has put a gift plan in place that will keep his name alive and support Westminster Ingleside Foundation long after he is gone.