We make a living by what we get. We make a life by what we give. 

— Winston Churchill

planned-givingAdding Value to Your Charitable Gift with Planned Giving

Planned Giving and Estate Planning are the most cost-effective means of promoting and securing major gifts to CP Nassau to help build its endowment and its future. This form of charitable giving provides a gift in two ways—the charity receives the financial assistance it needs to operate and the donor receives the piece of mind that they are protecting their valuable assets from income and estate taxes.

There are many vehicles that can be beneficial to CP Nassau and to your family. One of the easiest ways is supporting CP Nassau through your will by establishing a bequest. There are four easy ways to accomplish this scenario. The first is a general bequest of a certain percentage of your estate coming to CP Nassau. The second is a residuary bequest that allows CP Nassau to receive the remainder of your estate after all specific bequests have been made. The third is a contingent bequest that provides for the distribution of property in the event one or more of your named beneficiaries does not survive you. The final one is the life income bequest that will provide your loved ones a lifetime income, while it assures an eventual gift to CP Nassau.

Another great way to help CP Nassau is through a gift annuity. This allows the donor to receive a substantially larger return over the life of this gift. Annuity payments can be made to one or two person and present rates are usually 4 to 8% more than bank certificates. The donor also receives an immediate tax benefit and the annuity income may be tax-free. The rates are set by an actuary and require a minimum of $5,000. The interest rate is based on the age of the donor and the donor must be at least 50-years of age.

As you can see there are many options out there. If you are interested, please contact Leonard Weil for assistance.

Leonard Weil, CFO, CP Nassau
380 Washington Avenue, Roosevelt, New York 11575
516-378-2000 x648
LWeil@cpnassau.org

I need to write a will. Can CP Nassau help me?

YES. We can guide you through the entire process, making it as easy as possible. Just ask for your FREE Estate Planning and Will Kit. The Kit includes:

  • An Estate Planning Inventory Form, to help you help you a clearer idea of the worth of your estate.
  • Information on how to remember CP Nassau for Independence in your will
  • Estate Planning: Getting Started, a brochure
  • Revocable Living Trusts, a brochure

Effective Estate Planning usually takes time, effort and a good attorney. In the end your plan will allow your family to avoid the delay, dissension and needless expense that often occurs when a loved one dies without a will. Once you have taken care of your family’s needs, please consider a thoughtful bequest to CP Nassau.

To order your Estate Planning Kit, call the Department of Development at 516-378-2000 x648 or send us an email at info@cpnassau.org.

Can I use my IRA to give to CP Nassau?

Yes. Recently, the President signed a law that provides a new opportunity for donors who are 70 ½ or older to support causes like CP Nassau.
Under the new law you can transfer funds from your IRA account tax-free to CP Nassau. For 2007 only, you do not have to pay income tax on the IRA transfer.  This is a great way to support CP Nassau and avoid taxable income using your IRA distribution.
You may contribute IRA funds without paying federal incomes taxes if:

  • You are 70 ½ or older
  • The gift is $100,000 or less each year
  • You make the gift on or before December 31 in 2006 or 2007
  • Your IRA custodian transfers funds directly from an IRA or Rollover IRA to ucpn.

Contact you IRA custodian to transfer the amount you wish to CP Nassau.  It is wise to consult your tax professional before making your gift.

How do I include CP Nassau in my Will or Living Trust?

The most common way people remember CP Nassau in a Will or Living Trust is through a charitable bequests. You do not have to rewrite your current documents. You simply add an amendment, called a codicil, to your Will or Living Trust. Here is some suggested language you can have your attorney review:

“I give and bequeath to CP Nassau, located at 380 Washington Ave, Roosevelt, New York, 11575, —-% of my estate” (or state a specific dollar amount, or describe real of personal property, including exact location).

Your bequest is entirely under your control during life and becomes irrevocable only at death. If you have questions about bequests, call Leonard Weil, CFO at 516-378-2000 X205 or email him at LWeil@cpnassau.org.

What’s the big advantage in making CP Nassau a beneficiary of my retirement plan?

A designation in your IRA or other retirement plan may be a very cost-effective way of making a gift to CP Nassau.  If you leave your retirement plan to your children, they will have to pay income tax on either a lump sum distribution or the income stream from the plan. CP Nassau does not pay this tax.  Here’s an example of what this can mean to your heirs:

A widower died a few years ago.  He left his $300,000 house to charity and his $300,000 retirement plan to his relatives.  He should have done just the opposite.  The relatives had to pay income tax on the $300,00 in the retirement plan, an $80,000 cost to them.  If they had received the home, and the charity had received the retirement plan payment, no one would have paid income tax.

For more information on the advantages of retirement gifts to CP Nassau, call Leonard Weil, CFO, CP Nassau at 516-378-2000 X205 or email him at lweil@cpnassau.org.

What kind of donors should consider a charitable remainder trust?

Donors who need a device that will pay them for life, allow them to bypass capital gains tax on stock or real estate, reduce estate tax, and give them the satisfaction of providing for a good cause like CP Nassau. Anything you place in a charitable trust—cash, stock, real estate—is invested by the trustee to pay you income for the rest of your life and, if you wish, pay your heirs for life of for a term of years.  After the death of all income beneficiaries, what remains in the trust passes to CP Nassau. Your Trust may provide you with some important tax benefits:

  1.  An immediate income tax deduction for a percentage of your gift. We will be happy to give you an idea of the size of your deduction.  We simply need to know the amount to be placed in the trust, the ages of the income beneficiary (ies) and the payment rate of the trust.
  2. No tax on the sale of appreciated property.  From the donor’s point of view, this is often the most important tax benefit.  Sometimes thousands of dollars that would have gone in capital gains taxes remain in the trust to generate payments to the income beneficiaries.
  3. The Trust principal is not subject to estate tax.  Property that might otherwise be subject to federal estate tax, which can be has high as 55%, is preserved from estate tax entirely.

Appreciated real estate is often an excellent asset to place in a charitable trust.  Mature investment properties are frequently earning only two, three, or four percent of their fair market value per year.  When these properties are sold and the proceeds reinvested by the trust, earnings often increase significantly.

Under ordinary circumstances, owners face substantial capital gains taxes when they sell rental properties or commercial real estate.  In some cases personal residences are also subject to capital gains taxes even after the $500,000 exemption has been used.  In any case, because your charitable trust will be selling the property, there will be no capital gains taxes due when the real estate is sold.  Thus the entire proceeds of sale can be reinvested to produce more income for you.

Some people find it useful to give an undivided percentage interest of their property into a charitable trust rather than all of it.   For example a donor placed 75% of a vacant lot into a charitable trust.  When the lot was sold, about $70,000 came directly to her from the sale while $210,000 remained in the trust.  Some of their $70,000 was taxable, but they used the income tax deduction generated by their gift to the trust to offset the tax due on the gain built into the $70,000 they received.

Gifts of appreciated stock are ideal for funding a charitable remainder trust because the stock can be reinvested by the trust for greater income while bypassing capital gains taxes at the time of the sale.

The simplest way to gain these benefits with gifts of cash or stock is to open a pooled income fund account benefiting CP Nassau.  It’s as simple as opening a saving account, and an account can be started with as little as $5,000.  Like contributions to an individual trust, gifts to the pooled income fund give donors an immediate income tax deduction and lifetime income.  Ask us for our pooled income fund disclosure statement before contributing.

Finally, your trust must have a trustee.  If you have an individual trust tailored to your circumstances, the trustee can be a commercial institution such as a bank or trust company, an individual with professional experience in trust management, a relative, or yourself.  There are some complications in acting as trustee yourself, but it can be done if you understand and comply with IRS regulations. CP Nassau will be happy to supply you with a list of possible trustees of information on being your own trustees.

The basic advantages of charitable trusts are not difficult to understand:

  • Diversification of your assets without incurring capital gains taxes,
  • Lifetime income,
  • Immediate income tax benefits,
  • Reduction of estate tax,
  • The satisfaction of providing for a good cause.

There are even ways these trusts can benefit your heirs that we have not covered.  But first thing you should do is find out if a charitable trust makes sense for you. CP Nassau will provide you with tax and income calculations tailored to your particular situation.  This will give you and your advisors the information needed to make an informed decision as to whether a charitable trust meets your financial and philanthropic objectives.  All information is provided confidentially and without cost or obligation. CP Nassau deeply appreciates your willingness to help continue its work. For a personalized analysis call Leonard Weil, CFO at (516) 378-2000 x205 and/or send an email, lweil@cpnassau.org.

How can I give my home, and keep it too?

A charitable life tenancy agreement allows you to give a personal residence or farm to CP Nassau while retaining the right to live there for life.  Donors who enter a life tenancy agreement receive an immediate income tax deduction.  The deduction is based on the present value of the home discounted by the estimated length of time the charity must wait to receive the home.  To put it simply, a person age 70 will receive a larger deduction than will a person age 50.

The IRS grants the deduction even though the donor continues to enjoy full use of the home.  But the IRS also expects the owner to have full responsibility for the care and maintenance of the home.  That’s why life tenancy agreements simply continues things as they are currently, with the donor dealing with maintenance, property taxes, insurance and the like.  The major benefits to the donor, then are continued use of the home, an immediate charitable income tax deduction, the avoidance of probate, the avoidance of estate tax on the property, and the satisfaction of making a substantial gift to CP Nassau during one’s lifetime.  For further information call Leonard Weil, CFO at (516) 378-2000 x205 and/or send an email lweil@cpnassau.org.

What is the CP Nassau Heritage Society?

CP Nassau created this society to honor those who have remembered the organization in their estate plans through thoughtful bequests and other planned gifts. Those who do allow us to use their names will be recognized in the CP Nassau Annual Report. All members receive a commemorative award and are invited to special CP Nassau events.

What should I do if I have remembered CP Nassau in my estate plan?

We would be honored to enroll you in CP Nassau Heritage Society, so please let us know of your bequest by calling Leonard Weil, CFO at (516) 378-2000 on extension 205 and/or send an email lweil@cpnassau.org.