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IRAs and other tax-deferred accounts are great assets to leave to charity. What we see with clients it’s usually ingrained in us to sack as much away in our 401k and our IRAs as we can and then all of sudden you get some clients that get to a point where they don’t often necessarily need that amount when they’re in retirement. And because when the distributions of IRAs are subject to income tax and upon death, subject to estate tax, if you leave a portion or maybe even all of your IRA to charity it’s going to go completely tax free to the organization. So it’s really a great strategy to leave a portion, a certain portion of the IRA to charity rather than include your charities in your estate, frankly, your will or your trust.
Eden Prairie, MN Estate Planning Attorney David Ness talks about how to use an IRA for charity.