Giving it all away.

For CEOs and other high earners, retirement planning is like playing golf in bubble gum: Everything is holding you back.

For starters, $150,000 is the maximum income you can use to calculate your tax-sheltered pension contribution. Further, if a large part of your compensation is in company stock, you can reach retirement age with a one-stock portfolio that pays a low return, yet can't be sold without triggering the 28 percent capital gains tax. Then, if you delay taking benefits from your retirement plan to build the payout, you risk a 15 percent penalty tax if your annual benefit, when finally taken, exceeds $150,000. Finally, if you die with a large accumulation in your retirement plan, those assets could be hit with the dreaded "triple whammy," a combination of penalties and income and estate taxes that can consume more than 80 percent of your retirement savings. With all these headaches, you may as well give your money away.

As it turns out, that may be the best solution. Giving money to charity can be a highly effective way to accumulate a larger tax-sheltered nest egg for a more prosperous retirement and help you transfer more of your assets to your children and other heirs.

A few years ago, private foundations were a popular choice. But, at the end of 1994, they lost a key tax benefit - the donor's right to claim the fair market value of donated stock. Since then, a new charitable entity, called a "supporting organization for a public charity," has been steadily replacing them.

A supporting organization is like a private foundation but has far superior tax advantages. Donors can claim the fair market value of highly appreciated stock and gain an annual tax deduction of up to 30 percent of their adjusted gross income, with a five-year carryover.

Generally, a supporting organization is partnered with a charitable trust that provides a vehicle to shelter the donor's assets, generate income, and earn tax deductions. After the death of the donor and his or her spouse, the money remaining in the trust transfers to the organization, where it can be managed for charitable purposes by the donor's heirs.

Here's how a charitable trust, in tandem with a supporting organization, can help you win the retirement game.

1) Accumulating more tax-sheltered assets. There is a charitable trust called a NIMCRUT - "Net Income with Makeup Charitable Remainder UniTrust" - that's ideal for accumulating tax-sheltered assets. "Makeup" means that if the trust doesn't earn enough money for the stipulated annual payout, the deficiency can be accumulated and paid out in later years when the trust's annual earnings are greater.

So let's say you start a NIMCRUT at age 45 and deposit substantial sums into the trust every year. Since the goal is accumulation, all of the money is invested in growth stocks that pay little or no dividend. Every year, the income from the fund falls far short of the stipulated annual payout, and that deficiency accumulates. You retire at age 65, and your goal now becomes increased income, so you reverse your investment strategy. All of the money is invested in securities that pay a high return. Now you receive the stipulated payment plus makeup payments for the amounts that were missed in previous years.

2) Diversifying a stock portfolio without paying capital gains tax. The threat of capital gains tax keeps many investors from selling highly appreciated stock. However, a charity can sell such stock, tax free. So, you donate your shares to a charitable trust and name your supporting organization as the charity to receive the remainder of the money. The trust sells the stock, invests the proceeds in securities with a higher return, and pays you and your spouse a lifetime annuity. If your goal includes transferring assets to your children, you can use some of the extra income and tax deductions generated by the donation to pay premiums on a joint and survivor life insurance policy on yourself and your spouse. Upon the death of the second spouse, the money from the insurance flows to your children.

3) Dealing with the "triple whammy." All money in tax-sheltered retirement funds is vulnerable to both income and estate taxes, plus penalties for excess accumulations. If your lump-sum retirement money has been placed in a rollover IRA, your spouse can receive the remainder of your IRA at the time of your death through a transfer to his or her rollover IRA. This delays the worst of the tax problems until your spouse's death.

To soften the eventual tax blow, your spouse can establish a charitable trust as a beneficiary of the IRA distribution. When he or she dies, the trust receives the entire sum from the IRA and immediately begins distributing income to the heirs. The estate tax and any penalties must still be paid, but because of the charitable trust, no income taxes are due at the time of death. This strategy assures your heirs of a much larger income - and lets you rest easy.

C. Paul Tyborowski is president and chief executive of Columbus Circle Trust Co., a Stamford, CT-based trust company.