Maximizing Charitable Gifts

Although IRAs are a popular vehicle for charitable donates, simple mistakes may cause beneficiaries grief. If you name a charity as a beneficiary, consider these factors to help maximize the amount gifted to the organization and additional account heirs.
1. Name the charity directly. This ensures that the distribution goes directly to the charity, avoiding the expense of probate. It also helps ensure the intended money isn’t considered as income to the estate of the deceased IRA owner.
2. Set up a separate IRA account for the portion you plan on gifting. If the charity is listed on the same account as other beneficiaries and the charity’s allocated amount isn’t taken within the IRS’ required time frame, the living beneficiaries may need to take their distributions earlier than required.
3. Don’t convert assets that you’re leaving to a charitable organization. Converting assets to a Roth IRA would cause you to pay income taxes on the amount unnecessarily.
Whether you’re filling out beneficiary forms or determining if separate accounts are needed, it’s important to work with a knowledgeable financial advisor. For more insight and assistance on maximizing your charitable gifting, contact us at (661) 297-7566 or visit www.PiersonWealthManagement.com.
Pierson Wealth Management is located at 28368 Constellation Rd., Ste. 396, Santa Clarita, CA 91355. Securities and advisory services offered through Cetera Advisors LLC (doing insurance business in CA as CFGA Insurance Agency LLC), member FINRA/SIPC, a broker/dealer and a Registered Investment Adviser. Cetera is under separate ownership from any other named entity. CA Insurance Lic# 0C92500. For a comprehensive review of your personal situation, always consult with a tax or legal advisor. Neither Cetera Advisors LLC nor any of its representatives may give legal or tax advice.