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Benton Community Foundation has over fifteen years of experience connecting people with charitable causes that are important to them and their families. The Foundation is a public charity under IRS section 501c3 and gifts are tax deductible to the fullest extent of the law.
Though we have hundreds of families that support our work annually through gifts of cash, most families will make their largest gifts through their estate plans. There are many ways to leave a legacy through the Foundation, some can even provide an income to you during your lifetime. We encourage donors to consult their tax and legal advisors before making a gift.
Below are the most frequently used methods of planned giving.
A bequest is made through a donor’s will or living trust. It is easy to establish and revocable; a simple codicil can be done if you already have a will in place. You can state your bequest as a set amount of cash, securities, or other assets; or as the “residue” or a “percentage of the residue” of the estate. Download our simple bequest language now.
Life Insurance/Retirement Account Beneficiaries
Retirement assets make excellent charitable gifts because they are so highly taxed when left to individuals. It typically takes a simple form from your account provider to add the Foundation as a beneficiary. Not only can Benton Community Foundation be named as the beneficiary of a life insurance policy, but a donor can also transfer the policy irrevocably to the Foundation and claim an income tax deduction for the policy’s cost basis or cash surrender value (whichever is less). Any subsequent premium payments will be tax-deductible.
Charitable Remainder Trusts
A donor may transfer assets to a charitable remainder trust that provides a specified distribution percentage to one or more (income) beneficiaries for life, or a term of years, with the remainder interest paid to charity. These types of trusts can be established through the assistance of an attorney and/or trust department at a financial institution. There are two kinds of CRTs:
- Charitable remainder unitrust. A CRUT requires annual revaluation of the trust assets — which typically changes the value of the unitrust payment — and allows donors to make additional gifts to the trust.
- Charitable remainder annuity trust. A CRAT does not allow donors to make additional gifts to the trust, and CRAT assets are not revalued annually, so the income beneficiary receives the original cash amount.
Charitable Lead Trusts
A donor may transfer assets to a charitable lead trust. A charity is the income or “lead” beneficiary for a lifetime or term of years, after which the remaining assets are distributed to the donor or other beneficiaries.
A charitable gift annuity is a contract between a charity and donor. In return for a donation of cash or other assets, the charity agrees to pay donor and/or someone designated by donor a fixed payment for life. The donor can claim an immediate charitable tax deduction for the amount of transfer above the value of the annuity purchase. If a donor funds a gift annuity with long-term capital gain property — e.g., with appreciated stock — the donor will report only some of the gain, and may be able to report it in installments over many years. Donors may establish a deferred charitable gift annuity and defer receiving income from the gift annuity for a period of years.