Gifts Made by Beneficiary Designations
Retirement Plan Gift
Frequently Asked Questions
When can I make a retirement plan gift?
You can make a gift from your IRA, 401(k), or other qualified retirement plan that will take effect today, or you can make a future gift. Here’s how it works:
- Today: You can make a current gift of up to $100,000 per year from your IRA assets. Your gift is free from tax, fulfills your minimum distribution requirement, and provides immediate financial support for the Academy. This immediate gift option is only available for IRAs.
- Future: If you prefer to make a gift with future impact and anticipate that your
retirement plan holds assets beyond what you will need during your lifetime, you may wish to name the Academy as a beneficiary of your retirement plan. Future gifts can be made from any type of retirement plan.
How do I go about making a current gift?
The Academy can provide you with a sample letter you can use to contact your IRA administrator and arrange for a current gift.
How do I go about making a future gift?
You have three options for making a future gift:
- If you wish the Academy to receive all your retirement plan assets, you may name the Academy as your plan’s beneficiary.
- If you wish the Academy to receive a portion of your remaining plan assets, you may name the Academy as a beneficiary along with other beneficiaries.
- If you wish the Academy to receive your retirement assets only after your spouse or other primary beneficiary is deceased, you may name the Academy as a contingent beneficiary.
Upon your death, your retirement plan gift will be passed to the Academy
How do I benefit from a retirement plan gift?Making a gift from your retirement plan enables you to leave assets to beneficiaries at a lower tax cost. In fact, because undesignated retirement assets are subject to double taxation, you could avoid as much as 70 percent in estate and income taxes by designating a beneficiary or beneficiaries for your retirement plan. You also ensure the most efficient distribution of assets in your estate—all while leaving a
permanent legacy to the Academy.
Example: Retirement Plan Gift
Upon your death, any undesignated assets left in your retirement plan are subject to both estate and income taxes. As a result, your heirs can pay substantially more tax on these assets than they would other estate assets, such as securities or real estate. Even if your estate is not subject to estate taxes, your heirs will pay the highest
income tax rate on any undesignated retirement plan assets they inherit.
What steps do I take to make a retirement plan gift?
Retirement plan gifts can be made using paperwork provided by your retirement plan administrator. Here’s how to get started:
- Talk with the Academy staff about ways to make a charitable gift while preserving or enhancing retirement income.
- Obtain a description of your plan from your plan administrator. The description should include the plan’s value and distribution options.
- Ask the administrator about any limitations or restrictions that may apply to your plan, and if it is possible to name your estate or a charity as a plan beneficiary.
- Review any proposed changes with your financial and legal advisors.
- Decide upon an appropriate plan for making a retirement plan gift to the Academy—for example, current or future; leaving all or a portion of the assets to the Academy; naming the Academy as beneficiary or contingent beneficiary.
- Request a change of beneficiary form from your plan administrator and designate California Academy of Sciences as beneficiary according to whatever conditions you choose to apply.
- Work with the Academy staff to determine what you’d like your legacy gift to accomplish.
Insurance Plan Gift
If your life insurance assets are no longer required for their original purpose—for example, if your children are grown or your spouse is financially secure—making a gift of your insurance plan assets can be a great way to support the Academy. By designating your life insurance benefits as a charitable gift, you may be able to reduce income or estate taxes on these assets while making an important future gift to the Academy.
If your life insurance gift is worth more than $5,000, you may need to have its value appraised. The Academy can help you by providing the names of appraisers.
As you would with all significant financial decisions and changes, please review your insurance policy with your financial and legal advisors before deciding on a gift.