Have Your Cake ... and Share it, Too!
The Children's Hunger Project was built by the blood, sweat, and tears of volunteers…but they also require financial support to survive. By making donations during your lifetime, and "planned gifts" in your will or estate plan, you can continue to support The Children’s Hunger Project's charitable mission to feed hungry local children on weekends.
There are many different ways to provide financial support. You can add The Children's Hunger Project as a beneficiary on your life insurance, retirement plan or certificates of deposit. Outright lifetime gifts are the simplest form of charitable giving. Here is a brief breakdown of different ways to gift:
1. Outright gift - such as giving cash or writing a check). You can give property or stock to charitable organizations instead of cash. By donate to a qualified charity during your lifetime, you can receive an income tax deduction. If the gift is given at your death, your estate may benefit from an estate tax deduction.
2. You can add The Children's Hunger Project as a beneficiary on your life insurance. Because all that is required on the part of the donor during life is maintenance of the policy through payment of premiums, gifting of life insurance proceeds can enable a donor to deliver a benefit greater than that which might otherwise be affordable to the donor, which may provide an “amplified” gift to the charity. Additionally, there are generally no adverse tax consequences; the life insurance proceeds pass free of any post-death administration, fees or transfer costs; and there is generally minimal delay in payment of the proceeds to the charity. The donor simply names the charity as the designated beneficiary and pays the premiums to maintain the insurance policy during their lifetime.
3. Charitable remainder trust (CRT). This technique enables an individual to make a deferred gift to a qualified charitable organization, while retaining a right to payments from the CRT. Gifts made via CRT usually include appreciated assets, such as marketable securities, real estate and closely held stock. The CRT can provide additional income for donors while generating immediate tax benefits. Additionally, the donor (and the donor’s spouse) can retain control over management of the CRT assets until their deaths. At such time, the remaining trust assets pass to the charitable organization(s) named as remainder beneficiaries in the CRT.
4. Charitable lead trust (CLT) – essentially, a CRT that operates “in reverse”. The CLT can be established during life or upon the donor’s death (through a will or living trust). The CLT typically pays a fixed dollar amount to public charity or private family foundation for a set term of years. When the term of the CLT ends, the remaining assets are distributed to members of the donor’s family (or otherwise, as the donor has directed). This technique often works well with assets expected to appreciate significantly.
Working with an estate planning attorney can provide the opportunity to utilize some of these ideas to make a meaningful gift possible.