![Structuring a Charitable Bequest of IRD Assets Structuring a Charitable Bequest of IRD Assets](https://eu-images.contentstack.com/v3/assets/bltabaa95ef14172c61/blt6f821cf23f6bd4d5/6733feaacf158c630542e754/hoyt.jpg?width=1280&auto=webp&quality=95&format=jpg&disable=upscale)
Decedents’ estates contain an increasing amount of income in respect of a decedent (IRD) assets (principally in the form of individual retirement accounts and other retirement plan assets). These assets trigger taxable income to the beneficiaries when they receive a payment. If an individual with a sizeable amount of IRD assets intends to make a charitable bequest, estate planners recognize that those assets can be the most attractive property with which to fund the charitable bequest. If all goes well, the entire pre-tax amount of IRD can be transferred tax-free to a tax-exempt charity.
But, sometimes things don’t go well. The worst case scenario is that an estate or trust might have to recognize taxable IRD income but won’t be able to c...
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