PLANNED GIFTS: ANOTHER WAY TO HELP

PLANNED OR DEFERRED GIVING IS IMPORTANT FOR MANY NONPROFIT ORGANIZATIONS. It can be just as important in helping donors get full value for their generosity. As our Capital Campaign enters its next phase many of us are thinking of the long term future of Bear Creek Greenway. There are many planned giving options, including gifts of appreciated securities, bequests, and designating one or more charities as beneficiaries on insurance policies or retirement plans. Many planned gifts can be combined with an immediate gift. This is also a time to review your financial situation in light of the new tax federal tax act. Many people will find they can afford to be more generous and provide for the financial security of their family. Of course, discuss these matters with your tax and legal advisors. For more information on the kinds of gifts that can help the Bear Creek Greenway, please E-mail Wes Reynolds or call him at 482-4927.

GIFTS OF APPRECIATED SECURITIES

People owning appreciated securities (stocks, bonds, mutual funds, etc.) can be better off to contribute shares instead of cash to charitable causes. Appreciated property that is now worth more than its original cost will be subject to tax upon sale by its owner. If the property is sold at its present value, the gain is subject to income tax. The gain on securities will be subject a capital gains tax of some rate even under the new law.

When a donor makes a gift of the appreciated security, she is allowed a tax deduction for the present fair market value and avoids the tax she would otherwise have paid on the gain. The gift property can be sold by the charity as soon as transferred in order to realize cash for the organization's needs. Therefore, it is more economical to use appreciated property for charitable gift purposes than it is to use cash. For the particulars as they might apply to your situation, please consult with your tax advisor.

A SIMPLE WAY TO MAKE PLANNED GIFTS: CHARITIES AS BENEFICIARY

One of the simplest ways one can make a future gift to a charitable organization is to name a charity as your beneficiary. This might be something one might do with a life insurance policy where one's original need for the policy has changed. For many people the beneficiaries of qualified retirement plans (known as IRA's, 401(k), SEPs, 403(b), Keogh, etc. ) may face as many as three types of taxation. These accounts are tax-deferred so are subject to income taxes when money is withdrawn, they can also be subject to estate taxes and a tax on accounts the federal tax code defines as "too large". A gift to charity can avoid income and estate taxes on these accounts. See your legal and tax advisors to see when such a gift may help your family and charity.

INSURANCE CAN BE USED FOR CHARITABLE GIFT PURPOSES
  1. Insurance may be used to name a charity as beneficiary and owner. Many individuals have purchased insurance in previous years for a purpose that no longer exists or is fulfilled through some other means. It makes an excellent gift and the donor is allowed an income tax deduction for its value. The gift must be irrevocable and ownership assigned to the charity for an income tax deduction.
  2. An individual can purchase insurance in order to create a gift. There are many insurance programs available for application to charitable gift programs.
  3. Insurance can be a useful tool to help someone make another gift to charity. Insurance can be used to create liquidity or replace for one's heirs when donor provides a substantial gift in some other way.

REASONS TO HAVE WILLS TRUSTS PREPARED

Obviously, there can be no charitable bequest if there is no will or trust, but there are a number of other reasons for having a will or trust. Among these reasons are the following:

  1. To control disposition of your property at death to family, friends, and other intended beneficiaries in the amounts and proportions of your choice, rather than at the disposition and formulas determined by law.
  2. To name a personal representative of your choice (or trustee, in the case of a trust) to handle the settlement of your affairs and to supervise the disposition of your property according to the provisions in your will or trust rather than by a personal representative appointed by the court.
  3. To name a guardian for your minor children or other legal dependents, and at the same time to waive a potentially cost bond which would be imposed if you died without a will or trust.
  4. To save estate and inheritance taxes in the light of the current tax law, as well as to reduce other expenses associated with death (court costs, attorney's fees, bond requirements, etc.).
  5. To exercise responsible citizenship by providing for charitable enterprise and the advance of human well-being though organi-zations such as those represented by this nonprofit organization.

TWO HELPFUL BROKERS

Do you have appreciated securities (stocks, bonds, mutual funds, etc.) That you would like to contribute to Bear Creek Greenway Foundation? If so, local civic-minded brokers can help you and the Greenway.

Jim Maddux of Smith Barney at 680 Biddle Road in Medford can also sell your securities on behalf of the Greenway. Jim will handle the sale at no cost to Bear Creek Greenway Foundation. The phone number for Smith Barney is 779-5010 or 1-800-547-1741.

Jeff Monosoff of Investment Management and Research at 389 East Main in Ashland can sell your securities on behalf of the Greenway. Jeff will make a gift of his commissions on the sale to Bear Creek Greenway Foundation. The phone numbers for Investment Management & Research are 488-2634 and 779-4088.

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