What Planned Giving Options Are Available?
Planned gifts can be made using various types of property:
- Appreciated securities (whether publicly-traded or privately-held) owned more than a year
- Appreciated real estate owned more than a year
- Assets such as life insurance policies, savings bonds, commercial annuity contracts and funds held in an IRA or other qualified retirement plan
They can take any of several different forms:
- An outright gift is one that is immediately available to RTB. Transfers of appreciated securities are particularly popular because you not only receive an income tax deduction for the full value of the securities contributed but also avoid tax on any of the gain.
- A bequest is another frequently chosen type of gift, as you can retain full ownership and use of an asset for as long as you live. Click here for sample bequest language. Likewise, a distribution from a qualified retirement plan at the end of your life means you need not give up a source of income prematurely.
- A charitable gift annuity pays a fixed, guaranteed amount for life to one or two persons, including you and your spouse, if applicable. In almost every instance, a portion of the payments will be tax-free, and you are entitled to a tax deduction for a portion of the value of the assets you contribute.
- A charitable remainder trust pays income to you and/or other beneficiaries either for the life of the beneficiaries or a term of years. The amount of income can be fixed or variable, depending on the type of trust. It is common for such trusts to be funded with property which has increased in value, due to the fact that neither you nor the trust pays any capital gains tax at the time of funding. An income tax deduction is also available for part of what you contribute.
- A gift of life insurance may be made either by designating Reasons to Believe as a beneficiary of the policy or by arranging for us to become the owner of the policy. The former entails many of the same advantages as a bequest, whereas the latter can result in current income tax savings.
- A bargain sale can make sense if you would like to contribute an asset to Reasons to Believe but cannot afford to make an outright gift. Our purchase of an asset for less than its fair market value means you receive an income tax deduction for the difference between the price paid and the full value, plus only a portion of any gain will be taxed.
- A retained life estate arrangement is possible with either a personal residence or a farm. You donate the property but retain the right to use it for the rest of your life. You receive an income tax deduction for the present value of the remainder interest and avoid any potential tax on capital gain.
- A charitable lead trust can be a tremendous way for you to provide a stream of income for Reasons to Believe during a period of time prior to having the trust's assets pass to your heirs at a substantially reduced gift and estate cost.
How Do Planned Gifts Help Reasons to Believe?
Planned gifts allow Reasons to Believe to prepare for tomorrow and for growth. Planned giving also provides financial stability to the ministry.
Reasons to Believe currently has an endowment set up to fund future ministry advancement. For information on endowment gifts, contact Monica Jones at firstname.lastname@example.org or call (855) 732-7667.
How Can I Learn More About My Options?
To receive additional information, or if you and/or your advisors desire assistance in considering which plan is appropriate for your situation, contact Strategic Stewardship Coach Jon Schendel at email@example.com or call (949) 542-0663.
How Does a Donor Benefit in Making a Planned Gift?
In most cases, a planned gift also offers one or more of the following benefits to the person or entity making the gift.
- A current income tax deduction
- Increased cash flow from an asset, sometimes at more favorable tax rates
- Preservation of an asset's appreciation in value coupled with the elimination, reduction, or deferral of capital gains tax
- Professional management of assets relied upon for income
- Gift and estate tax savings