Tag Archives: planned giving

Story of Personal Benefits from Planned Giving Program

By: Elizabeth Koch, Midland Division

After receiving a bone marrow transplant to fight cancer, suffering from severe heart failure and surviving a pulmonary embolism, Mark Hanneke knows just how short life is. But he is sure about one thing – he’s happy with the life he leads. One facet of this includes participating in The Salvation Army’s Planned Giving program.

Hanneke participates in the Planned Giving program because he wants to help The Salvation Army during his lifetime, as opposed to including The Salvation Army in his will or living trust.

A benefit of Planned Giving Hanneke utilizes is the ability to alter the amount of donation at any time. Another advantage to the Planned Giving program is that, as a lifetime income, the payout is much higher than both long-term and short-term CD rates.

Besides those benefits he also decided contribute to The Salvation Army because he thinks it is one of the best charities in the nation that not only helps those in need but also assists them to gain success and independence.

It was important to Hanneke to give while he was able to, and he feels fortunate for himself that he is in a position to help people. He ultimately wants to share that feeling with others.

“By doing the Charitable Gift Annuity, you’ve made that lifelong commitment at that time, and it’s definitely going towards The Salvation Army, and it can definitely help them all throughout your remaining lifetime­ – which is a wonderful feeling knowing that you’re helping people,” says Hanneke.

Hanneke also sees Planned Giving as a way to better the world as a member of the Baby Boom era. He recalls many discussions about 40 to 45 years ago revolving around making a difference in society, and feels he is doing his part through donating to The Salvation Army. He challenges other baby boomers fortunate enough to do the same.

“Here’s your opportunity in your lifetime now, in your age group now, if you are fortunate enough to help that you can make a difference and it’s a great way to make a difference and make changes in the world,” explains Hanneke.

Charitable Remainder Trusts, helping to create a legacy of hope

By: Tim Henry, Planned Giving Director

Ten years ago your Uncle Vinnie gave you a wedding gift, the privilege to buy ten thousand shares of closely held stock in his great new internet start up called Linkintomyface.  You are told the stock is worth ten cents a share, but by buying now for a mere $1,000, you will be making the investment of a lifetime.  You have held onto the stock not knowing what to do with it, except cashing the hundred dollar dividend checks you receive each year, but you have just been informed that the company is going public with an IPO on the stock market.  Great news, because based on the popularity of Linkintomyface, you are informed the initial offering price per share is going to be set at $350 a share.  This means that your ten thousand shares valued at $1,000 when Uncle Vinnie sold you the shares will be worth at least $3.5 million. Again great news, you are now a millionaire, you no longer have to worry about paying your mortgage every month or funding the kids’ college education and you can buy everyone in the family a new car.

With your initial investment of a $1,000 now worth several million dollars and having bills to pay and things to buy, and because it is the stock market and you never know what will happen tomorrow, you decide to sell all your stock and take the profits.  You are set, no more worries about money you are ready to start living the good life, but now for the bad news the tax man cometh, and you owe the government capital gains tax on the increased value of the stock, which increased $3,499,000 in value since you bought it ten years ago.  As you write out the check to the IRS you wonder if you had other options than the sale of the stock.

One option, to merely cashing in your stock and paying capital gains tax, is you could make a donation of all or part of the stock to The Salvation Army in the form of a Charitable Remainder Trust.  In so doing, you would save yourself on capital gains tax and potentially other taxes, while making a donation to the Salvation Army that will benefit and improve the lives of many people in your community and helping to secure your legacy, a legacy of hope in troubled and difficult times.

But what is a Charitable Remainder Trust?  A Charitable Remainder Trust (CRT) is a legal arrangement in which a donor gives over a piece of property or money through a donation to a charity, but the donor continues to use the property or receives an income from the asset for a set period of time, usually the donor’s lifetime.  When the specified time period ends the trust property is then available for use by the charity.  The benefit to the donor is that they avoid any capital gains tax on the donated assets and potentially earn an income tax deduction for the fair market value of the remainder interest the trust earned.  Further, since this is an irrevocable trust the asset is removed from the donor’s estate, meaning the assets of the CRT will not be calculated into the donor’s estate for the purposed of the estate tax.

Thus, the donor receives a yearly payment of income from the CRT during their lifetime, potentially reduces their tax liability significantly and makes a donation to the Salvation Army to benefit the needy in their community.  So, before you cash in your shares in Linkintomyface, evaluate if there is a way to maximize the benefit you receive and benefits you can pass on to your community, by give to the Salvation Army through a Charitable Remainder Trust.

If you have any questions or you would like to secure a legacy of hope by making a donation of a Charitable Remainder Trust or discuss other ways you can create such a legacy please call Tim Henry Director of Planned Giving at 314-646-3016 or email at timothy_henry@usc.salvationarmy.org.

IRS CIRCULAR 230 DISCLAIMER “Pursuant to regulations governing the practice of attorneys, certified public accountants, enrolled agents, enrolled actuaries and appraisers before the Internal Revenue Service, unless otherwise expressly stated, any U.S. federal or state tax advice in this communication (including attachments) is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of (i) avoiding penalties that may be imposed under federal or state law or (ii) promoting, marketing or recommending to another party any transaction or tax-related matter(s) addressed herein.”

Charitable Gift Annuities, A New Option for Your Retirement Plan

By: Tim Henry, Director of Planned Giving

The nation slowly continues the long road of recovery from the “The Great Recession”, or the other assorted names it has been known in news headlines, but average Americans care little of the names used by the media they care about the impact the downturn has taken on the financial security their families.  As the country starts this economic recovery, one of the main areas of damage the average American is trying to repair is the damage done to their retirement plans.  However, uncertainty in the stock markets and low return on investment offered by investment vehicles like, five year certificates of deposits and 10 year Treasurys, both of which currently have rates of return around 2% annual percentage yield, have left many looking for a suitable alternative to traditional investment opportunities.  One such alternative option is a Charitable Gift Annuity, while not an investment but a gift, it can be used to provide a measure of income security during one’s lifetime and leave a charitable legacy.

A Charitable Gift Annuity as the name suggests is a combination of an outright charitable gift and the purchase of a fixed income annuity contract.  The terms of the annuity can be set to either provide immediate payment of income to the donor or defer payment of income for a period of time, for when a donor expects he or she will need additional income, such as during retirement.  Another, important factor to understand about a charitable gift annuity is that in order to qualify as a gift the rate offered by the charity must be lower than the rates offered by commercial insurance annuities. However, when compared to the rates of return of some commercial investment opportunities, charitable gift annuities provide attractive rates, as well as providing the donor the opportunity to donate to a cause in which they believe.  To paraphrase St. Paul’s sermon, “‘tis better to give than to receive,” and by making a gift though a charitable gift annuity you can both give and receive.

While calculating gift annuity rates is individualized to each donor, standardized rates based on age are set by the American Council on Gift Annuities, currently those rates provide a higher (4.7% for a person age 65, 6.8% for a person age 80) annual percentage yield rate than the 2 percent presently received by investing in certificates of deposit and Treasurys.

The current American Council on Gift Annuities rates took effect on January 1, 2012, however, the Salvation Army is still offering the higher 2011 American Council on Gift Annuities rates. Thus, under the current Salvation Army Charitable Gift Annuity rates, subject to individual circumstances, a person 65 years of age giving a single life charitable gift annuity could see a income return of 5.3%, and  a person 80 years of age giving a single life charitable gift annuity could see a income return of 7.5%.

It is important to act quickly to take advantage of the current rates offered by The Salvation Army Charitable Gift Annuities as the rates will be adjusted later this year to match the rates published by the American Council on Gift Annuities.

By taking advantage of the current rates and making a gift to the Salvation Army through a charitable gift annuity you will be able to both give and receive and help the Salvation Army with the mission of Doing the Most Good.

For information concerning current rates and other options related to charitable gift annuities please contact the Salvation Army Midland Division Planned Giving Department at 1-800-533-6865

Current American Council on Gift Annuity Rates for Single Annuity

Age

Rate

Age

Rate

Age

Rate

5-10

2.0

50

3.7

73

5.5

11-15

2.1

51-52

3.8

74

5.7

16-19

2.2

53-54

3.9

75

5.8

20-23

2.3

55

4.0

76

6.0

24-26

2.4

56-57

4.1

77

6.2

27-29

2.5

58

4.2

78

6.4

30-32

2.6

59

4.3

79

6.6

33-34

2.7

60-61

4.4

80

6.8

35-36

2.8

62-63

4.5

81

7.0

37-38

2.9

64

4.6

82

7.2

39-40

3.0

65

4.7

83

7.4

41-42

3.1

66-67

4.8

84

7.6

43

3.2

68

4.9

85

7.8

44-45

3.3

69

5.0

86

8.0

46

3.4

70

5.1

87

8.2

47

3.5

71

5.3

88

8.4

48-49

3.6

72

5.4

89

8.7

90+

9.0

Age

Rate

Age

Rate

Age

Rate

5-10

3.0

58-59

4.7

76

6.6

11-15

3.1

60

4.8

77

6.8

16-19

3.2

61

4.9

78

7.0

20-23

3.3

62

5.0

79

7.3

24-26

3.4

63

5.1

80

7.5

27-29

3.5

64

5.2

81

7.7

30-35

3.6

65

5.3

82

7.8

36-39

3.7

66

5.4

83

8.0

40-42

3.8

67

5.5

84

8.2

43-45

3.9

68

5.6

85

8.4

46-47

3.0

69

5.7

86

8.6

48-49

4.1

70

5.8

87

8.9

50-51

4.2

71

5.9

88

9.2

52-53

4.3

72

6.0

89

9.5

54-55

4.4

73

6.2

90+

9.8

56

4.5

74

6.3

57

4.6

75

6.5

Potential Single Annuity Rates for Salvation Army Charitable Gift Annuity

Plan Your Legacy with The Salvation Army

Pyramids rising in the desert… paintings on a cave wall… great works of art and literature – all reflect a common yearning in people to leave behind a legacy – to touch the lives of others, perhaps for many generations to come.

Most of us, given the opportunity, would like to feel that we have made a lasting contribution to a better world. We’d like to leave a legacy that says, “I was here. My life was important. I made a difference.”

Friends who include The Salvation Army in their estate plans enjoy the quiet satisfaction of helping continue all of our work – assisting those who are hungry or seeking shelter or fighting alcoholism or drug addictions. As you plan for both the present and the future, we would be honored if you would consider The Salvation Army as your partner. We pledge to do the most good with your generosity – for those you will help today and for the future generations you will help in years to come.

You have an opportunity to thoughtfully plan the distribution of all you have earned and accumulated from a lifetime of work. Through tax-advantaged gift planning, you can provide a more significant legacy of caring and compassion than you ever dreamed possible. This is your Legacy Gift.

A Salvation Army gift planning professional is always available to assist you, your financial adviser and legal counsel in exploring the options that best serve your family and your financial needs, while fulfilling your hopes for a better world. Your Legacy Gift may be unrestricted or designated for a particular purpose, service of program. Your gift also may be made in memory or in honor of special loved ones.

If you’re ready to begin planning your legacy, or if you have any questions at all, contact our Planned Giving Department at (314) 646-3000 today.

In thanksgiving…

By: Valerie Murray, Estate Coordinator, Midland Division

As the Estate Coordinator for the Midland Division, I spend most of my day among the dead; dealing with gifts to The Salvation Army from wills and trusts.  Some might think that this would be a depressing job, but actually, it is a life and faith affirming experience.

Several times a week, I receive a notice that The Salvation Army was remembered in a will or trust of a someone who recently died.  The first thing I do is to try to find more information about him or her: date of death, where they lived, and a copy of their will or trust.  In looking for this information, other information of a more personal nature often comes to the fore.

One woman remembered the Army “in thanksgiving for their kindness to my father and his buddies during World War I on the front lines in France.”  Another woman donated almost her entire (and fairly large) estate to The Salvation Army because her family never forgot that when her father returned from World War I, permanently disabled by poison gas, the Army helped him find a job and continued to be a constant in his life.  Without that help, would he have been able to marry and have a family?

A nephew stated that his uncle remembered the Army in his trust because as a GI in Patton’s army, the Army was right there with them in the mud, giving away (not selling, he emphasized) candy, donuts and other treats, and last but not least words of hope and encouragement.

 A young Viet Nam veteran, recently discharged in the mid 1970s, traveled across the United States one on his trek home, staying in Salvation Army shelters receiving a hot meal, and a good word at each.

 These are just a few stories that I have come across.  Even though my clients are dead world, their stories are life affirming.  They recount just a few of good works of The Salvation Army worldwide.  So many more will never be known.  They make me wonder, have I done enough?

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