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FOUNDATION NEWS Caring for the Ministry of Grace: "Ecclesia Perpetua" August 2007 | |||
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Did you know you can arrange a gift to your church now, but defer completion of the gift until later? For example, when you include the church in your will, you make a two-step, or "deferred", gift. The first step occurs when you create your will. Here, you name any ministry to receive a future bequest from your estate. The second step takes place when your will "matures" and that ministry receives the bequest. Other two-step gifts occur when you name your congregation as a beneficiary in a life insurance policy or when you designate a ministry to receive what is left in your retirement fund. These two-step gifts have one important thing in common: They can be cancelled, or revoked, prior to completion. For example, a person can always write a new will or change the beneficiary designation on a policy or brokerage account. Because these deferred gifts can be reversed, they are called "revocable" gifts. Since these gifts are incomplete, they appeal to those who may not want to lock up a major gift at this time. They provide donors with the satisfaction that a gift plan is in place, while adding the assurance that the asset can be retrieved should an emergency occur. The trade-off for |
this flexibility is that revocable gifts do not qualify for a charitable income tax deduction. Such is not the case with "irrevocable" deferred gifts. Once initiated, these two-step gifts cannot be undone. Consequently, the IRS allows a charitable income tax deduction in the year the gift is made. An example of an irrevocable deferred gift is the charitable gift annuity. Suppose donor X gives $25,000 to Grace Lutheran Church for a gift annuity. Every year for the rest of her life, she will receive a set amount from the ELCA Foundation, paid monthly, quarterly, semi-annually or annually. Since our policy forbids us from using any part of the gift upon receipt, the entire amount is set aside in reserve. Only when the annuitant dies are the funds available for projects at Grace. There are other irrevocable deferred gifts as well, such as charitable remainder trusts and contributions to a pooled income fund. Though these gift arrangements differ in various respects, they all provide tax, as well as other, benefits to the donor. To learn about ABC's "two-step" giving program contact our Oregon Synod Director of Planned Giving, Dr. Patricia Larsen, at (503) 244-4102. Or email her at Blessed2Give@cs.com. | |||
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For the 2007 tax year, it is possible to give up to $100,000 from your IRAs. The donation from the IRA is excluded from you, the donor's, taxable income. The funds are 'rolled over' to the charity. Additionally, the donation counts towards the minimum IRA distribution requirements. Unfortunately, this option currently expires at the end of 2007. If you would like more information or help in making such a gift, please contact the synod's Director of Planned Giving, Dr. Patricia Larsen. You may call her at (503) 413-1405 or email her at Blessed2Give@cs.com. |
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