Planned Giving/Estate Planning

Will/Bequest

After your death, a Will instructs your personal representatives how to distribute your assets to individuals and to a charitable organization like Saint Joseph's College. Without a Will, the laws of your state of legal residence will dictate how your assets are divided. This may be quite different from your intentions.

A current Will provides you:

• the opportunity to express your values to your heirs
• a chance to care for your heirs according to their specific needs
• the occasion to make gifts to charitable organizations, like Saint Joseph's College, whose mission you have supported during your life

Having your Will prepared by an attorney and executed according to your state's guidelines is essential.

During your lifetime, a bequest can remain private, can be modified at any time, and does not deprive you of the use of your assets.

Additional information:

• Durable Power of Attorney
• Health Care Proxy

Life Insurance

A new policy may be taken out on the life of a donor to "create" a major deferred gift to Saint Joseph's College, with the cost of the premium being a small fraction of the face value of the policy. Donors may also have existing policies which are no longer needed for their original purposes (e.g., to assure a child's education). With a change of policy ownership and beneficiary to SJC, the donor can contribute the premium amount to the College and the policy's face value can be maintained, or, if the donor chooses not to continue payments, the cash value or "paid up insurance" value can be significant. Donors' tax deductions are equal to their cash/replacement value or premiums paid, depending on the type of policy.

Charitable Gift Annuity

This is a simple contract between you and Saint Joseph's College that pays you a fixed dollar amount (annuity) for your lifetime and for another individual if desired, based on your age(s) at the time of your gift. The older you are, the higher the annuity. If you use appreciated property, such as stocks, to fund the gift annuity, you will escape the capital gains tax on the gift portion of the transaction and the remaining gain will be appreciated over your lifetime. This is a wonderful way to increase income from stocks that pay small dividends and carry capital gains.

Life Estate

A donor deeds his or her personal residential property (or a farm) to Saint Joseph's College. While the donor is still living, he or she has a legal interest in the life estate with full rights to live there or to rent or sell those rights. The donor continues to take care of the property, pay the taxes and receives any income it generates. The donor receives an immediate income tax deduction for the present value of the remainder interest of the residence. Any appreciated value of the property also avoids capital gains taxation. The transfer takes place outside the donor's will; therefore it will not pass through probate.

Trusts

The Charitable Remainder Unitrust is a life income trust which specifies that the donor is to receive each year either net income or a fixed percentage of the net fair market value of the trust assets valued each year. The fixed percentage must not be less than 5 percent. The trust assets become the property of Saint Joseph's College 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 present value of remainder interest going to the College.

The Charitable Remainder Annuity Trust is a life income trust which specifies that the donor (or other designated beneficiary) receive annually a fixed dollar amount which must be a least 5 percent of the initial net fair market value of the transferred property. There is not an annual valuation as with the unitrust. No additional contributions may be made to an annuity trust. Upon the death of the donor (and named second beneficiary), the assets of the trust become the property of Saint Joseph's College.

A Revocable Trust is similar to the previously described trusts, the principal difference being that the donor may revoke the trust at anytime. Revocable trusts are appropriate for donors who would like to make a gift upon their death, but do not wish to make an irrevocable gift during their lifetime. A reason frequently stated for this is the concern the donor may have that the trust assets may be needed by the donor for some unforeseen emergency. The donor would earn no income tax deduction, but his/her estate would receive an estate tax deduction.

Real Estate

A gift of real estate offers you the opportunity to make a significant charitable contribution to Saint Joseph's College with a tax-friendly outcome. There are several ways to donate real estate depending on your situation.

• Outright gift
• Retained life estate
• Bargain sale
• Vacation time shares

Retirement Assets

Tax laws often subject retirement plan assets to the highest combined income and estate taxes; a charitable donation to Saint Joseph's College of these assets may be the most efficient estate planning option. Many techniques can be used to create generous charitable gifts, usually at your death, from retirement plan assets that could otherwise be subject to tax rates of nearly 65 percent. At the same time, you can pass more tax-favored assets to your family. We suggest that you consult with your attorney or tax specialist for a strategy best suited to your situation.