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Retirement Planning > Retirement Investing

The Charitable Solution

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To lessen the effect of IRD, some clients may want to name a qualified tax-exempt charity as beneficiary of a retirement account. This approach may be particularly attractive if the gross estate is significant enough to be subject to estate tax, because, when a charity is the named beneficiary of a retirement account, the balance of that account is removed from the gross estate for federal estate tax purposes. Another benefit is that, in the hands of a qualified charity, the IRD liability inherent in the retirement account would be avoided.