Gifts from Estate Plans
| The most
practical way to make significant gifts may be through your estate
plan – by means of a will, living trust or beneficiary
designation on a life insurance policy or retirement account.
Such gifts are wholly revocable while you are alive and may save
significant taxes for your estate. |
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Wills and Living Trusts
A bequest is the
most traditional way to provide significant help for worthwhile
causes. With a gift through your will or living trust, you keep
full use of your gift assets during your life. Some bequest language
you can share with your adviser is located in Facts for Advisers.
You can structure a bequest to the National
Osteoporosis Foundation in ways that will be both personally
satisfying and tax advantageous. Charitable bequests take many forms:
Outright (specific) bequest. This is a gift of a particular amount
of money or item of property (for example: "I bequeath $25,000
to the National Osteoporosis Foundation.").
Residuary bequest. The residue of an estate is the amount remaining
after all specific bequests have been distributed; the exact
amount will not be known until the final accounting is completed.
The residue may pass as a percentage bequest (e.g., "I give
one-third of the residue of my estate to the National Osteoporosis Foundation.").
Contingent bequests. You can name a secondary beneficiary to receive
property in the event the primary beneficiary is not alive (for
example: "I bequeath $10,000 to my father, but if he has
predeceased me, I direct the $10,000 be paid to the National
Osteoporosis Foundation.").
Financial Accounts
Most accounts at
financial institutions can be made payable on death to a person
or a charitable organization. Ask the manager of the institution
how you can arrange to designate a death beneficiary for your
CD, savings account, share accounts, etc. In some areas, this
is accomplished through a "P.O.D." (payable on death)
designation. Securities in a brokerage account can be left through
a "T.O.D." (transfer on death) designation.
Retirement Accounts
Your estate can save both
income taxes and estate taxes if you make a charitable organization
beneficiary of part or all of your IRA or other retirement account.
Family members might keep only 30 cents on the dollar, after
taxes, from these assets. Recent changes in IRS regulations have
made it simpler and more favorable to name worthwhile causes
as beneficiaries of IRAs and other retirement accounts.
Life Insurance
You can name our organization
as the beneficiary of a life insurance policy (or a percentage
of the proceeds) – just contact the company for appropriate
forms. A better idea may be to transfer actual ownership of the
policy to us (assuming it is a "surplus" policy that
is no longer needed for family security). Your gift will entitle
you to an income tax deduction, and any future premium payments
will be tax deductible.
Residences and Farms
Friends who own personal
residences, including condos and vacation homes, can make gifts
of their property but continue to use the property for the
rest of their lives. The same opportunities work with farms
and ranches. The advantage of a lifetime gift, reserving lifetime
use, is that you receive an income tax charitable deduction,
in addition to estate tax savings.
Call us before you make or amend your will,
establish a living trust or name beneficiaries for pension plans
and life insurance.
Charitable Lead Trusts and Loans
It's possible to
contribute merely the income from securities or other property
temporarily and enjoy substantial income tax or gift and estate
tax benefits. We're talking about an exciting technique called
the "charitable lead trust." Alternatively, you can
lend cash (up to $250,000) and remove the annual interest from
your tax bracket.
Charitable lead trusts
can be especially helpful to friends who need large charitable
deductions in a year of exceptionally high income, or face heavy
federal estate taxes. Call us for details.
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