Caring for the Future Susan French is a woman who defines the phrase "full of life." Whether she is teaching fitness classes at the Fort Sanders Health and Fitness Center or volunteering at the Knoxville Symphony League, Knoxville Museum of Art Guild, United Way and others, Susan lives life with gusto and passion. She is also a woman who has known heartbreak – her husband of just a few short years passed away at a much too early age. "The diagnosis was devastating but George and I did make the most of the time we had together," says Ms. French. Part of this time was spent in planning for her future. According to Ms. French, "I wanted to fight the disease which claimed my husband, so I looked at what I possessed and decided to make a gift from my retirement plan to benefit the Thompson Cancer Survival Center. 'Never give up' became George’s motto and now it’s my motto, to never give up and always try to make a difference." Naming a charity as a primary or secondary beneficiary of your retirement plan is a good way to minimize taxes and still know that when you are finished using your well-earned retirement dollars, what is left will benefit the TCSC Foundation. Ask your retirement plan administrator for a Change of Beneficiary form, and indicate the amount or percentage you would like to go to TCSC. Let us know so that we can thank you for this most generous gift that will benefit many in the years to come. "It’s an easy way to make a difference," says Ms. French.

A quick question: what’s your largest single asset? Ten years ago most people reading this article would have said their home was their largest single asset. We now know that because of changes in tax laws and the tremendous historical growth of the stock market most people say their retirement plans (IRA, 401(k), 403(b), Keogh) have the most value within their estate.

If you have accumulated significant funds in your tax-deferred retirement account, congratulations! Please remember, however, that these funds are tax-deferred not tax-free. As you know, you will pay taxes on the income you receive from your retirement plan but did you know your estate or plan beneficiaries also may have to pay taxes on whatever funds are left when you pass away? These taxes due upon your death may be as much as 70%!

You can gain peace of mind and reduce the tax burden of holding these retirement plan assets until your death. Instead of leaving these tax-deferred retirement assets to your family, who will pay resulting income taxes, consider designating one of Covenant Health's foundations as the named beneficiary of your qualified retirement plan. This designated gift will pass your assets free of estate and income tax and be used 100% in support of the mission of these foundations. Best of all, you gain the satisfaction now of knowing you will provide future support to touch lives in need.

In addition to naming one of these foundations as a beneficiary of your qualified retirement plan, you can also:

• at age 59 1/2, begin making withdrawals from most retirement plans without having to pay an early withdrawal penalty. These withdrawals will still be subject to income tax but by taking out an amount sufficient to fund your charitable gifts, the taxes due can be offset by your charitable deductions which often results in a "wash" for tax purposes.

• transfer your IRA assets to a charitable trust. No taxes are due because the charitable trust is a tax-exempt entity. The trust provides an income to the beneficiary (you, your spouse, or family member) with an eventual gift to the foundation. The beneficiary pays income tax on payments from the trust but your estate receives an estate tax charitable deduction for the value of the foundation’s right to eventually receive the trust assets.

The procedure for naming one of Covenant Health's Philanthropic fundations as a beneficiary of your retirement plan is simple. Contact the administrator of your plan and ask for a beneficiary change form which typically asks the following information:

• The foundation’s full legal name

• The foundation’s permanent mailing address

• The foundation’s federal tax identification number

• Your relationship to the beneficiary: Charity