bequests through planned giving vehicles
Very often donors ask about the various ways gifts can be made to the Boys & Girls Clubs of Greater Scottsdale Foundation. The needs of each person and family are of course different and there are many ways to structure a gift to meet individual financial circumstances. The following is a summary of some of the more common methods of shaping your charitable bequest. The list is offered as information only and is not intended as legal or tax regulatory advice. You should always consult with your tax counsel to discuss a planned giving program. In the event that you need assistance, the BGCGS Foundation can assist you in your search.
Bequests
One of the most common planned gifts is a simple bequest in a donor’s will. The gift can be designated as (a) a percentage of the donor’s estate, (b) a specific dollar amount or description of property, (c) a residual of the donor’s estate, or (c) contingent upon a certain event happening. Estate taxes can be reduced by the value of the gift made to the Boys & Girls Clubs of Greater Scottsdale Foundation.
Charitable Lead Trust
The BGCGS Foundation receives income payments from the trust for a given number of years. At the end of the trust term, the assets of the trust are returned to the owner or his or her designee. This allows the transfer of assets to the children while greatly reducing gift taxes.
Charitable Remainder Trust (CRT)
The donor receives a variable income from the gift for the rest of his or her life. The income to the donor is based upon a specified percentage of the trust principal, revalued each year, reflecting any increases in the value of the trust’s assets. More than one person may receive income. The trust assets become the property of the BGCGS Foundation upon the donor’s death, or in a pre-established time period. Additional contributions can be made to the trust. Income tax deductions for the donor are based on the current value of the remainder interest going to the Foundation.
Charitable Remainder Annuity Trust
Similar to the “Charitable Remainder Trust” except that (a) the donor receives a fixed income from the gift for life, (b) the income amount is based upon the original value of the trust’s assets, and (c) additional contributions cannot be made.
Charitable Gift Annuity
A gift is not placed in trust but becomes the property of the BGCGS Foundation immediately. In exchange for the gift the Foundation promises to pay a fixed income to the donor for life. A portion of the income is not taxable but considered return on principal. An income tax deduction is allowed for the difference between the gift value and the amount required for funding the annuity. (Actuarial value) There is a maximum of two income beneficiaries.
Deferred Gift Annuity
A gift is made to the BGCGS Foundation now and an immediate income tax deduction is given the donor. At a later date the donor begins receiving income. Because the principal compounds between the date of the gift and the first date when the donor receives income, the amount of income can be significant and at a much greater rate than that of the standard charitable gift annuity.