If you have a Retirement Plan -- your 401(k), IRA, Keough, or other such accounts -- you may be surprised to learn that the IRS will impose income tax on any balance that you direct through your will to a non-spouse beneficiary. This tax is in addition to the estate tax that will be imposed on the account. For estates fully subject to the estate tax, the result can be that 70 percent of the value of your retirement plan will be consumed in taxes before your child, relative or friend receives it.

There is a sensible charitable alternative: name Washington National Opera as the beneficiary of your retirement plan, then use other assets not subject to income tax to make gifts to your heirs. The Opera is not required to pay income tax on our distribution, and your heirs will receive their share of your estate without the burden of extra taxes.

Retirement plans can also be used to fund a gift annuity during your life. Any lifetime distributions from a retirement plan are subject to income tax, even if you donate them to the Opera. However, your charitable deduction for this gift would partially offset those taxes.

Thoughtful gift planning ensures maximum benefits for you and for the Opera. For additional information on planning your gift or for an individualized illustration, provided confidentially, please contact:

Washington National Opera
Steve I. Schneider, Esq., Director of Planned Giving
2600 Virginia Avenue NW, Suite 301
Washington , DC 20037
202-295-2418 | Fax: 202-295-2479
E-mail: sschneider@dc-opera.org

(Back to All Gifts-at-a-Glance)

The type of gift you make determines your tax benefits, and tax laws frequently change. You should consult your own legal and tax advisors regarding planned gifts to Washington National Opera.