By Diane Ladenson

Here’s a primer course on some of the ways you may want to consider a planned gift to the Minnesota Senior Federation.

Bequests - A donor can make a future charitable gift through his/her will. A donor names a charity as the residual beneficiary of his/her estate or as the recipient of a specified dollar amount or percentage. A “contingency” bequest provides a charitable gift under certain conditions specified by the donor. Bequests are deductible for federal estate tax purposes.

Life Income Gifts - A donor makes an irrevocable transfer of assets and in return one or two beneficiaries (donor, spouse, children, and/or friends) receive payments. Upon the death of the beneficiary, the remaining assets are used by the charity for purposes defined by the donor. The donor receives a current income tax charitable deduction for the remainder value of the charitable gifts.

Charitable Remainder Trust - Cash or property is transferred to a trust, which pays the beneficiary either a variable income equal to a fixed percentage of the trust’s fair market value as determined each year or a fixed annual amount. Upon the death of the beneficiary, the charity may use the remaining assets for the purposes specified by the donor.

Charitable Gift Annuity - Cash or property is contributed to the charity in exchange for a commitment to pay the beneficiary a specified annual amount for the remainder of the beneficiary’s life. When the beneficiary dies, the charity may use the remaining assets for the purposes specified by the donor.

Other Gifts

Qualified Retirement Plan Assets - Using IRAs, 401Ks, or other retirement plan assets provides a donor significant tax advantages. Unlike many assets, these are potentially subject to both income and estate taxes. Naming the charity as the beneficiary can eliminate estate and income taxes if the gift is properly structured.

Retained Life Estate - A donor can contribute a residence, vacation home, or farm while retaining the right to live in and use the property. The donor can receive a generous current income tax deduction for the gift as well as other advantages.

Life Insurance Policy - A policy no longer needed to provide for heirs can be used to make a charitable gift providing a tax deduction for the current value of the policy.

Private Foundation - The assets of a private foundation can be used for a direct gift or for a transfer of assets to the charity.

This information was presented at the Metro Regional Convention, May 2007 by Diane Ladenson, former planned giving officer with the Saint Paul Foundation.