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Consider the following facts! According to the Connecticut
Leave a Legacy Organization, while 72 percent of all Americans
support the work of charities annually, only 5.7 percent remember
nonprofit organizations in their estate plans. When asked
why this gap exists, most people say it is because they have
not been asked or have not thought about it.
Planned giving is a way to work with your attorney, accountant
or financial advisor (1) to support causes which you care
about in your estate plans and (2) to make a tremendous difference
in the world you leave behind.
EXAMPLES OF PLANNED GIVING VEHICLES
1. Outright Gift
Definition: A donation of cash or other assets such
as stock, real estate or personal property
Benefits: Gift goes to work right away, provides income
or estate tax relief, eliminates capital gains tax on donated
appreciated property
2. Bequests
Definition: Gift made by a bequest in a will which
may include a certain dollar amount; stock; real estate; all
or a portion of what remains from an estate after debts, taxes,
expenses and other bequests have been paid; assets only under
certain conditions such as only if a spouse or other beneficiary
does not survive
Benefits: Donor's estate is entitled to an estate
tax deduction for the full value of a charitable bequest
3. Retirement Plan Assets
Definition: Nonprofit named as beneficiary or partial
beneficiary of retirement plan
Benefits: Provides income and estate tax relief
4. Life Insurance
Definition: Policy used to make a future gift to a
nonprofit (i.e., beneficiary) or to preserve the legacy passed
on to heirs by replacing other assets donated to charity with
a life insurance policy purchased with capital gains and income
tax savings
Benefits: Range of estate and income tax benefits
5. Life Income Gift
Definition: Cash and other assets irrevocably transferred
to a trustee to manage while assuring the donor continued
income from those assets; at the end of a term of years or
at the end of a donor's or beneficiary's life, the remaining
assets are used to support a nonprofit organization according
to the donor's desires
Benefits: Current commitment of assets may result
in a larger future gift, provides immediate income tax benefits
as well as relief from capital gains and estate/gift taxes,
converts low or non-income producing assets into increased
cash flow, can supplement retirement income, income can be
used to buy a life insurance policy preserving wealth for
heirs
6. Charitable Remainder Trusts
Definition: Cash or other assets irrevocably transferred
to a trustee who manages the assets and pays income to the
donor or beneficiary for life or a term of years. At the end
of the trust term, a nonprofit endowment fund receives the
remaining principal.
Benefits: Donor receives income tax deduction and/or
pays no tax on capital gains
7. Charitable Lead Trusts
Definition: Donor irrevocably transfers assets to
a trustee and has income from the trust paid to a nonprofit
endowment fund either for a certain number of years or until
the donor's death. At the end of the trust's term, the principal
is distributed to heirs.
Benefits: Minimizes gift and estate taxes, provides
no income tax benefits
For more information on planned giving and the associated
tax benefits, please talk with your lawyer or financial/tax
advisor or call
The mission of The Sharon Historical Society is to connect
people to the town of Sharon, its history and its culture.
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