Planned Giving Programs Support ABC and Provide Personal Financial Advantages

Good plans shape good decisions. That's why good planning helps to make elusive dreams come true. —Lester R. Bittel, The Nine Master Keys of Management

As a non-profit organization, ABC values and appreciates the support of our donors, but we also want to ensure that your gift is the right choice for you. Planned giving, deferred giving, or estate giving are some of the names that describe a process of managing your financial affairs so that you can make a charitable gift that will provide the greatest benefits to you, your heirs, and ABC.

To help you balance your goals for your current financial interests, retirement, your family and your charitable interests, we invite you to please consider supporting ABC through one of these many planned giving options:

• An outright gift of cash or stock.

• The creation of a charitable gift annuity or a charitable trust.

• The purchase or assignment of a life insurance policy naming ABC as a beneficiary.

• A bequest or legacy gift.

Gift of Cash or Stock

Gifts of stock provide an immediate tax deduction and allow you to minimize or avoid capital gains tax on the gift. This is especially helpful when donating appreciated securities because your cost basis is low and you may be able to deduct the full fair market value. You can also use appreciated stock to set up a charitable gift annuity or charitable trust, described in more detail below.

Charitable Gift Annuity

You can make a significant contribution to ABC and receive cash flow and tax benefits by creating a charitable gift annuity. With as little as $10,000, you can start a charitable gift annuity using cash, securities, real property, or personal property. Through a transfer of your assets, you or a beneficiary receive income from the annuity for a fixed period of time or for your lifetime. Your tax incentives include:

• A charitable income tax deduction for a portion of the initial gift.

• A partial or complete bypass of capital gains tax when you fund the gift with appreciated property.

• An exemption from estate taxes for the asset.

However, there are also certain restrictions. Generally, the minimum age for the donor to begin receiving annuity payments is 60. The annuity is determined by using a percentage payout associated with the age of the donor (or income beneficiary); the older the annuitant, the larger the annuity.

Charitable Remainder Trusts

Similar to a charitable gift annuity, a charitable remainder trust makes periodic payments to one or more individuals of your choosing for life or for a term of years and provides a tax deduction. Upon termination of the trust, the property remaining will be used for the charitable purpose you have specified. Charitable remainder trusts can be created in two ways:

A unitrust provides income that fluctuates annually as a fixed percentage of the fair market value of the trust. This type is more suited to donors who want to participate in market gains and can tolerate some risk.

An annuity trust provides fixed income payments, determined when the gift is made. This type is more appropriate for individuals who wish to avoid the risk of market fluctuations.

Charitable Lead Trusts

Unlike the charitable remainder trust, the charitable lead trust provides initial benefits to the charity and then makes periodic payments to one or more individuals of your choosing for life or for a term of years. Upon termination of the trust, the remainder goes back to your estate.

Life Insurance Policy Assignment (partial or complete) or Purchase

A simple way to make a significant gift to ABC is to include us as a beneficiary on your life insurance or to purchase a separate policy for ABC. You can choose to purchase a life insurance policy and name ABC as the beneficiary. For relatively low premiums, you can make a substantial gift to ABC in the future. Another possibility is that the growth of your assets or the changing needs of your dependents has left you with an unnecessary life insurance policy. If you do have a life insurance policy that you no longer need, please consider assigning it to ABC or including ABC as a beneficiary. We would greatly appreciate these kinds of actions. In addition, if you make the assignment to ABC irrevocable, you can combine charitable goals with tax advantages by receiving a calculated deduction, up-front for the assignment.

Bequest or Legacy Gift

Through a bequest or legacy in your will, you can make a generous gift without reducing your current income. The bequest could take the form of a special fund in your name or in memory of loved ones. Charitable bequests are usually fully deductible from estate taxes. Perhaps you participate in a local or regional foundation to assist you with your charitable giving. Please consider making ABC one of your designated charities.

Contact Financial Professionals and ABC

These are just a few creative ways you can combine your financial management with your philanthropic goals. Many of these allow you to maximize your gift to ABC while at the same time providing you with tax savings, income, and other benefits. For more information, contact your estate planner, tax advisor, or ABC's Chief Administrative Officer Wayne Silverman, PhD, at 512-926-4900 begin_of_the_skype_highlighting FREE 512-926-4900end_of_the_skype_highlighting ext 120 or the Development Department.

—Aileen Truax