Now that jimrac has given an example, I understand the point he is trying to make. However, there's a couple of things he doesn't consider. IF you took an inheritance as cash, and IF you kept it as cash, then yes, you could spend it down without incurring income tax. However, if you take that money and invest it, you will pay taxes upon your gains. But you do get that Âstep up basis jimrac is depending upon. But of course, if you allow the account to compound over time without spending principal, you run the risk of incurring estate taxes for your own heirs. You could also buy an annuity, which has some limited tax advantages. Conversely, inheriting an IRA is different. You do not have to cash out an inherited IRA, in fact you should always roll it over into an FBO account in your and the deceasedÂs names. IF the owner was taking distributions, heirs also have to take distributions  but they can take the minimum distribution (Required Minimum Distribution, or RMD) which at young ages is a very modest amount indeed. If the owner was not taking distributions, the IRA can be left intact until age 70-1/2 for the heir. And in the case of an inherited Roth IRA, there is NEVER any income tax, for owner or heirs. Because the gains in the Roth compound tax-free, they win hands-down over any taxable account. The biggest issue is the salary restrictions (higher wage earners are barred from contributing to a Roth, although in 2010 only they can convert any amount they wish to pay income taxes on now) and the low annual contribution amount (although I expect Congress will probably increase those at some point). As my ex-boss, a respected CFP, used to say, "Don't let the tax tail wag the dog!" Tax planning should be looked at in a holistic fashion. Somebody's going to pay taxes, it just depends on who that is, and how much. Frankly, if you had a $1M mutual fund account - and I know quite a few people who do - if you were that concerned about your heirs paying income taxes, you'd set up an ILIT (Irrevocable Life Insurance Trust) for your immediate heirs, and a Bypass or QTIP trust for the future generation heirs.

Working as a tax preparer I'm surprised by the difference (and often indifference) in giving. Here is some idea of the various levels of giving that I see and some traits that are pretty common within that level of giving. I have a number of clients that earn a middle-income and give $3000 or more each year to charity. From my experience those that give the most generously are active church participants though their donations are not limited to church nor is the majority of the donations to a church. Most of their donations are for a minimum of $100 to each individual charity and often to the same charities each year. The next group of donators is executives earning a higher income. Most often their donations are payroll deductions to United Way and vary from $520 to $1040 per year. As you might guess they work for companies that host United Way employee fundraising meeting. Quite often this is the only donation they make. The next group of donators is your average earner. They often have a weekly payroll deduction ($52-$104/year) to the United Way. Often include church donations of around $500 per year. Notable this group of donators while providing smaller dollar donations of $5-$50 is the biggest supporter of the local police, fire company, kids charities, and veterans charities. They may give to different charities each year. Overall their donations usually fall between $200-$700 per year. But the surprise to me is how many people do not give any charitable donations especially those with higher incomes ($100,000+). I was also surprised by how very few clients made donations in support of Katrina. I've noticed while preparing returns this year the amount of charitable donations was less than last year. The higher cost this past year for gas, increased property taxes, and medical expenses was often mentioned. I expect that next year with the requirement that donations require a receipt (or cancelled check for donations of less than $250) will further decrease the amount of donations that are claimed. On a personal note I will say that this year I too have less charitable deductions on my tax return than in previous years. Some of this is because my income was much lower this year. And some of it is because instead of donating to a charity we chose instead to help some friends and family in need. We gave some money to a friend who's husband was injured and could not work for 3 months. It was not alot of money but very appreciated. And last year a client of mine was very ill and out of work. I sent a note and a check to them as I knew they were facing financial problems with the loss of income and medical expenses. We also have a family member facing a serious medical problem and we helped them out. So our tax-deductible donations have been less but our hearts are in the right place.

No, I've never had the nerve because I know there could be something of importance I might need later, maybe years later. I normally through all of it away anyway, but don't have the nerve to throw it away not looked at one more time. I remember years ago, I worked for a woman who was a complete mess. I mean her desk looked like a tornado hit it, all the time. I don't know how she functioned. She'd ask me to organize it when she'd be out of town so when she came back everything would be nice and neat. Well, I got so tired of filing what I considered junk, I decided to throw something away that I had picked up numerous times and thought, this must be junk. Well guess what, she asked for it a while later and of course I had pitched it. After that incident I'd just take all her stuff, throw it in a cardboard file box, put it in storage and then when she asked for it, I at least had it in storage. After a year if she didn't ask for the stuff, I threw all of the contents away!!

A lot of good feed back for the OP except for the first one. Don't feel awkward, most financial advisors recommend a follow up after 3 to 4 weeks if the gift hasn't been acknowledged, but don't wait until years end encase something went wrong. The IRS explicitly requires written acknowledgment from the charity for a Qualified Charitable Distribution (QCD). What bugged me was the first comment from someone who pretends to be a high profile financial professional, which was misleading and incorrect, turning your question into blame, condescension and incorrect. I'm glad others were able to ease your concern with correct information. The problem, First; " I'm not sure there's a need for you to get an acknowledgement because the point of concern under the tax law is the distribution from the plan." If he's not sure why would he make a misleading comment for something this important to begin with? . The second issue is suggesting "Did you alert the charities involved in advance to inform expect what they would be receiving?" So it may be your fault he is saying? Notifying the charity first is rare and not required. So it's just another day pretending as a career to get a dopamine release through attention from under the bridge.