Retirement Plan Assets
For many individuals, a gift of retirement plan assets is a wise stewardship decision. If you transfer your retirement plan assets to a charity, such as Lutheran World Relief, you can save income taxes for heirs.
You can also pass these assets directly to a tax-exempt deferred giving plan, such as a charitable remainder trust. You designate who will receive income for life from the trust. After the death of the beneficiary, the remaining balance can be designated for charity.
Your retirement plan assets cannot be designated through your will, so you will need to file a beneficiary designation form through your IRA administrator.
Charitable Gift Annuities
A charitable gift annuity is an opportunity to make a gift and receive a tax deduction and yearly income for life. It is an irrevocable contractual agreement between a donor and a charitable organization.
The older you are at the time the annuity is established, the higher your annuity rates. You may also designate a beneficiary of these payments.
If you fund your annuity with appreciated property, rather than cash, you benefit even more because you reduce capital gains tax consequences.
Charitable Remainder Trusts
With a charitable remainder trust, you can receive income each year for the rest of your life from assets you give to the trust you create, and you also get an immediate tax deduction. Your income can be either variable or a fixed amount. After your lifetime, the balance in the trust goes to the charities of your choice.
When you make a gift of real property you have owned for longer than one year, you obtain an income tax charitable deduction equal to the property’s full fair market value. You also avoid capital gains tax on the appreciation of the property.
You may also deed your home to a charity and remain living in it for the rest of your lifetime. You receive an immediate income tax charitable deduction for a portion of your home’s value since the gift cannot be revoked.
Once the security of loved ones is no longer needed, your life insurance policy can be redirected to help support your favorite charity. Assigning Lutheran World Relief ownership of your life insurance policy can provide you with an income tax charitable deduction and reduce your future estate tax liability.