Planned Giving: Is it for me?
A little planning today can insure the thoughtful disposal of your assets and other property and can assure that you, your heirs (including pets) and charitable interests have a more secure future. Furthermore, planned giving methods are currently available that can provide you and your loved ones of income now, in addition to substantial tax benefits.
A sound estate plan, which includes a planned giving provision, can provide income as well as tax advantages to you now. The income can be for a lifetime or for a stated period of years, and the income can also be directed to other persons or organizations designated by you. We have provided information about some planned giving instruments below. However, you should always consult your attorney or estate planner on all such matters.
Each of the income-providing planned giving methods described briefly below has significant benefits for contributors who are intersted in the work of not-for-profit organizations, such as Pets in Need. The satisfaction of saving animals' lives and making a lasting gift that will help pets In Need always be there for our animals friends is gratifying. However, there are more pragmatic rewards. The tax benefits of such a gift can be substantial. A valid planned gift will offer savings in four ways: on income tax, capital gains tax, gift tax, and estate tax. In addition, depending on the method, the recipient organization may assume the duty of providing responsible management of the assets during the lifetime of the gift at no cost to you.
Charitable Remainder Unitrust
With this instrument of planned giving, you could potentially and irrevocably transfer money, stock certificates, personal or real property to a trustee who then pays you and possibly others income for life or for a period of years as determined by you at the time the assets are transferred. Then you and/or other income recipients (people and/or organizations) receive annual payments from the trust based on a fixed percentage selected by you and applied to the market value of the assets as determined each year. This means that the income will vary from year to year.
Charitable Remainder Annuity Trust
This instrument performs in much the same way as a Charitable Remainder Unitrust; however, there are two important differences. The annual income that the recipient receives as a result of such a charitable gift will always be the same regardless of the changing annual value of the assets. And, once assets are placed in this type of trust, you may not add to the trust capital to provide for a greater charitable deduction. The charitable remainder annuity trust may place you in a position of greater financial security because it fixes the amount of income paid annually regardless of market conditions.
Charitable Gift Annuity
The charitable gift annuity is a contract between you and a non-profit organization whereby the organization promises to pay a certain amount of money each year in exchange for a gift of property.
Charitable Lead Trust
The income from this type of trust is directed to a charitable organization for some period of years -- often ten or more. At the end of the stated number of years, the trust becomes the property of the individuals named by you, such as children or others, or it can revert to you. The lead trust differs from the unitrust or annuity trust in that the charitable organization receives the income from the trust during the trust period rather than receives the trust corpus at the end of the trust period.
If you have made a provision for Pets in Need already as part of your estate plan or as part of a program of planned giving, or are considering such a gift, please contact Brenda Barnette, Pets in Need's Executive Director at (650) 367-1405.
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