Making UMass Lowell the sole beneficiary or a contingent beneficiary of your retirement plan has a positive impact both on the university and on one’s estate.
Often, retirement plans remaining in an estate are subject both to estate and income taxes when left to one’s heirs. The effective tax rate on a retirement plan in larger estates may exceed 70 percent, leaving only a fraction of the original amount.
On the other hand, designating UMass Lowell as the beneficiary of your IRA, Keogh, tax-sheltered annuity, qualified pension, or profit-sharing plan allows the assets to pass directly to UMass Lowell upon realization without subjecting them to any income or estate taxes.
If you wish to make this type of gift, ask your plan administrator for a change of beneficiary form. The following language is suggested:
UMass Foundation for the benefit of UMass Lowell (you may also include a specific purpose such as a scholarship fund or a specific sport, college, or program).
If you have more insurance coverage than you need, you may consider giving UMass Lowell a paid-up policy. By transferring the ownership of your policy to UMass, you receive a charitable income tax deduction equal to the policy’s cash surrender value or cost basis, whichever is less.
For more information, please contact the UMass Lowell Office of Gift Planning at 978-934-4810 or GiftPlanning@uml.edu.