Beneficiary Designations – The Easiest Way to Make an Extraordinary Gift

Beneficiary Designations – The Easiest Way to Make an Extraordinary Gift

You‘ve likely already seen the good news about Mercy Home’s Legacy Challenge (in effect through December 31). The concept is simple: name the children of Mercy Home as beneficiaries of your estate plan, and you’ll automatically unlock 10% of your future gift today. The Legacy Challenge is a terrific opportunity to increase your impact on young lives, now and in the future—all without spending a dollar in your lifetime.

Of course, we know that updating your will or trust may seem like a daunting task. In most cases, you’ll need to call an attorney and pay a fee to write up new documents or amend old ones. That is why we’d like to show you a way to leave a legacy gift that is quick, easy, and free (and often the most tax advantaged strategy as well)!

Here’s the trick: the easiest way to make a legacy gift is through a beneficiary designation of a retirement account, investment, or bank account. Unlike a will or trust, you don’t need to consult an attorney… all you need is a simple form that you complete in 5 minutes.

Many people don’t know that most of these financial assets are not governed by your will or trust. This means even if you have these legal documents in place, you’ll still need to name beneficiaries for each financial account.

What’s more, many of these accounts are heavily taxed if left to heirs other than your spouse. But because charities are tax-exempt, you can name Mercy Home as a beneficiary of these accounts to ensure the full amount of your legacy gift will be used to help children in need (instead of Uncle Sam).

Retirement Accounts

It’s likely you have a retirement account, such as a 401(k), 403(b), or IRA. Because these plans are not governed by your will or trust, you must complete a beneficiary form, indicating who should receive the funds after you are gone. These plans are heavily taxed when left to heirs other than a spouse, so this is a great asset to leave to charity. Charities like Mercy Home are tax-exempt, meaning your full gift will be used to help children in need.

Transfer on Death (TOD) and Payable on Death (POD) Accounts

If you have a typical checking or savings account at a bank, an investment account with a brokerage firm, or even a certificate of deposit or money market account, you can name beneficiaries of each through a TOD (Transfer on Death) or POD (Payable on Death) Account.

TOD and POD accounts automatically transfer assets to a named beneficiary when the original account holder dies. This means you can simply name a beneficiary without an attorney, and these assets will be kept out of probate court entirely.

How to Add a Beneficiary

For many people, Beneficiary Designations are the easiest (and most tax-advantaged) way to make an extraordinary gift to charity.

To update the beneficiaries of your retirement or financial account, just visit your plan administrator’s website, or call and ask for a beneficiary form. To name Mercy Home as a beneficiary of your retirement account you will need:

  1. Legal Name: “Mission of Our Lady of Mercy, Inc.”
  2. Tax ID Number: 36-2171726 (Enter this in place of
    a Social Security Number)
  3. Mailing Address: Mission of Our Lady of Mercy, Inc.
    1140 W. Jackson Blvd. | Chicago, IL 60607

Once complete, please let us know about your commitment. Unlock free money for the kids in our care today, and ensure a safe and happy future for those who will need our help in the next generation!

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