Questions About Giving for Income

Anyone who wants to make charitable gifts while also preserving or enhancing personal financial security would be wise to consider such a gift. Gifts designed to accomplish both of these goals can be made in various amounts and are practical for people of broad ranges of income and wealth levels.

Charitable gifts that also provide the donor with income can be made in several ways. One popular option is to make a charitable gift while retaining a fixed income.

With this type of gift, the amount of income you receive is determined at the time you make your gift and remains the same from that point forward. This option is particularly attractive for those who wish to plan on a definite amount of income that will never change.

Another option allows you to make a gift that provides income that varies over time. Income you or a loved one receives from this type of gift will fluctuate each year depending on the performance of the plan’s investments. This option provides an opportunity for growth in income over time.

Payments are usually in the 5%-10% range, depending on your age, the type of gift plan and other factors. We will be happy to provide you with a complimentary illustration.

Income can continue for your lifetime and/or the lifetime of whomever else you name. Or, in some cases, you may specify that the payments continue for another period of time you determine, up to 20 years.

When payments are no longer needed or otherwise end, the remaining funds are devoted to charitable use.

You may fund a gift using a variety of assets—cash, stocks, bonds, mutual funds, real estate or other appropriate property.

Yes. Not only can you enjoy a generous tax deduction, you may also minimize, delay or completely bypass capital gain taxes.

Property (such as securities) that has increased in value while you have owned it may be the smartest choice to fund an income gift. In this case, your income tax deduction is generally calculated using the full fair market value of the property at the time you make the gift. You also avoid paying capital gains tax at the time the donated property is sold.

We will be pleased to discuss the best giving opportunities for your particular wishes and personal situation.

A gift that results in additional income for you may allow you to make meaningful gifts and, at the same time, help you achieve personal goals, such as the following:

• Educational expenses: If you want to provide funds for your children or grandchildren’s education, a gift that features an income stream may be an attractive and tax-efficient option. You can fund educational needs now or in the future while making an eventual charitable gift and can enjoy immediate tax savings.
• Supplement retirement funds: If planning for retirement is high on your list of priorities, an income gift can supplement other retirement plan income while also providing for a charitable gift when you or a survivor no longer need the income.
• Pre-retirement planning: If you are not yet retired, simply postpone income payments until you do retire and your income may actually be greater at the time when you need it most. Even though you are not yet receiving income, you will still enjoy immediate tax savings.
• Take care of loved ones: Do you want to provide financial support for a spouse, parent, child or someone else who depends on you? With a well-planned charitable gift, you can arrange for regular payments that can add to a surviving loved one’s financial security.