There are many creative ways to make a substantial "planned" gift to Friends Journal. The most common methods are to name the Journal in your will, or to create a Charitable Gift Annuity which provides an immediate tax deduction and guarantees an income stream during your lifetime.
The following examples are drawn from our booklet, "Reflections on Tomorrow."
Each year thousands of individuals, exercising the privilege to determine the final distribution of their estates, designate that a portion of their assets be used for the benefit and support of charitable organizations. Gifts by will have become an integral part of the philanthropic tradition because such gifts enable a person to make significant contributions that may not have been possible during one's lifetime.
Bequests can take various forms. The following sample of several types of bequests are included for your advisor's consideration in preparing your will.
General bequest: A general bequest is one of the most popular ways to make a charitable gift by will. You simply leave a specified dollar amount to a designated charity.
Example: I give dollar amount to Friends Journal, to be used for its exempt purposes.
Specific bequest: A specific bequest is another popular type of charitable bequest. With this bequest, you designate that a charity is to receive a specific piece of property.
Example: I give description of property to Friends Journal, to be used for its exempt purposes.
Residuary bequest: A residuary bequest is used to give a charitable organization all (or a portion thereof) of an estate owner's property after all debts, taxes, expenses, and all other bequests have been paid.
Example: I give the rest of the property I own at my death to Friends Journal, to be used for its exempt purposes.
Percentage bequest: A bequest can be expressed as a percentage of the estate or of the residuary estate.
Example: I give the desired percentage of my estate to Friends Journal, to be used for its exempt purposes.
Contingent bequest: When writing your will, it is important to plan for the situation in which the beneficiary of a bequest dies before you or disclaims the property. In anticipation of such an occurrence, you may name a charitable organization as the alternate or contingent beneficiary. This will ensure that the property will pass to the designated charity rather than to unintended beneficiaries.
Example: If name of beneficiary predeceases me or disclaims any interest in description of property, I give such property to Friends Journal to be used for its exempt purposes.
Click here if you would like to notify us that you have included a bequest for Friends Journal in your will.
The charitable gift annuity is among the oldest, simplest, and most popular methods of making a deferred charitable gift. In exchange for a transfer of cash, marketable securities or, under some circumstances, real estate, a charitable organization contractually guarantees to pay a specified annuity to a donor and /or another beneficiary.
The American Council on Gift Annuities -- a representative body of a variety of philanthropic organizations -- recommends rates of return for gift annuities. The annuity rate depends on the age(s) of the beneficiary(ies) and is actuarially designed to result in a gift of at least 50 percent of the value of the initial transfer at the death of the beneficiary(ies).
The following table shows the recommended rates that apply to both men and women. Please contact Friends Journal for our current rates.
|
ONE LIFE |
TWO LIVES |
||||
|
Age |
% Rate |
Charitable Deduction |
Ages |
% Rate |
Charitable Deduction |
|
65 |
6.0 |
$3,854 |
65-65 |
5.6 |
$3,066 |
|
70 |
6.5 |
$4,198 |
70-70 |
5.9 |
$3,461 |
|
75 |
7.1 |
$4,626 |
75-75 |
6.3 |
$3,920 |
|
80 |
8.0 |
$5,053 |
80-80 |
6.9 |
$4,404 |
The donor can claim a current charitable deduction for the portion of the transfer that represents the charitable gift element, which is the amount by which the value of the property transferred to a charitable organization exceeds the value of the annuity received. Another important tax benefit is that, as with other types of annuities, a portion of each annuity payment is treated as a return of the original principal and is received free of income tax over the life expectancy of the annuitant. The tax-free portion is greatest when the annuity is funded with cash.
Depending on the donor's financial-planning objectives, a choice may be made to emphasize the charitable deduction, by choosing a lower rate, or the annual return, by selecting a higher rate.
Once created, a gift annuity cannot permit additional contributions. However, it is possible to create additional annuities at any time.
An important feature of a gift annuity is that it may offer an escape from the age-old investment dilemma of the "locked in" position: an investor may want to dispose of an investment position for various reasons (e.g., to protect a profit or to reinvest for a higher yield) but is inhibited from acting because of the potential capital-gain tax on the appreciation. Avoidance of capital-gain tax coupled with a current charitable income-tax deduction can substantially reduce the "cost" of such gifts. And such gifts allow you, the donor, to make a substantial commitment to Friends Journal while retaining the financial security that these vehicles provide.
Learn more about establishing a Gift Annuity to benefit Friends Journal.
