Thursday, June 15, 2017

KBF Ambassadors

By: Richard Carnes

On March 8, 2017, the Kentucky Baptist Foundation (KBF) celebrated its 72nd anniversary of service to Kentucky Baptist individuals and ministries. Despite our strong history, we continually encounter Baptists who are unaware of our estate stewardship ministry. I am convinced the Foundation’s greatest challenges have been, and continue to be, our visibility, awareness, and understanding among Kentucky Baptists.

From the beginning of the Foundation’s ministry, its’ Core Convictions have been:

1. God is creator and owner of all things and we are called to be His stewards (managers).

2. How we plan our estates will likely be the single most significant act of financial stewardship we will ever make.

3. Through estate stewardship, each of us can impact the world for Christ.

4. To be successful in reaching their communities and the world for Christ, churches must be equipped to cultivate and secure legacy gifts their members are inspired to give.

One way we plan to increase our visibility is with a new initiative --- the KBF Ambassador Program. The Ambassador Program’s purpose is to create a network of ministerial and lay leaders who will enhance the visibility and awareness of the Foundation’s ministry and services by serving as the Foundation’s cheerleaders and encouragers in their congregations and communities.

Ambassadors in the KBF program will have the opportunity to become knowledgeable of the Foundation’s ministry and services and recommend the Foundation’s services to individuals or churches who have needs that the KBF may be able to meet. Foundation staff and board member representatives will provide education sessions on the Foundation’s ministries at regional sessions in the coming months.

We strongly believe this volunteer ministry will produce significant resources to assist local Baptist churches in reaching our communities and our world for Christ. Please prayerfully consider becoming a member of this new group of Kentucky Baptist men and women. Your efforts through KBF Ambassadors may help encourage and educate your friends in effective ways to provide for their families and Kingdom work.

To learn more about the KBF’s Ambassador Program, you may contact the Foundation’s trust counsel, Laurie Valentine, or me at our toll-free number (866) 489-3533.

Richard Carnes is the president of the Kentucky Baptist Foundation, PO Box 436389, Louisville, KY 40253; toll-free (866) 489-3533; KYBaptistFoundation.org

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

Thursday, June 1, 2017

Legacy Gift Designation

By: Richard Carnes

You may be hesitating to make a legacy gift to your church because you don’t want to incur the expense of changing your will. Actually, there are numerous ways to arrange a future gift while leaving your current will intact.

1. You can name your church or other Baptist ministry as a beneficiary of any portion of the death proceeds from a life insurance policy.

2. You can instruct your bank to distribute any portion of what remains in your account to your church or ministry at the end of your life. This is called a payable-on-death (POD) account.

3. You can instruct your investment advisor firm to transfer to your church or ministry any portion of investments held at the end of your life. This is called a transfer-on-death (TOD) account.

4. You can name your church or ministry as a beneficiary of any percentage of the remaining funds in your IRA, 401(k), 403(b), or other defined contribution retirement plan.

In each case, you need only request and complete the beneficiary form provided by the financial institution. When a church or ministry is named as beneficiary through one of these arrangements, the proceeds are not governed by your will and are not subject to probate.

However, like the provisions in a will, these beneficiary designations can be changed at any time. You need only complete a new beneficiary form. Adding or removing a charitable bequest requires a will change, though you could do this with a simple codicil (amendment) if the rest of the will still expresses your wishes.

A charitable gift by beneficiary designation, like a bequest in a will, qualifies for an estate-tax charitable deduction and could result in estate-tax savings, depending on the size of your estate.

Increasingly, estate assets are transferred to beneficiaries outside of a will. The Kentucky Baptist Foundation is honored to work with individuals seeking how best to designate estate assets they wish to gift to their church or other Baptist ministry causes. To learn more, you may contact the Foundation’s trust counsel, Laurie Valentine, or me at our toll-free number (866) 489-3533.

Richard Carnes is the president of the Kentucky Baptist Foundation, PO Box 436389, Louisville, KY 40253; toll-free (866) 489-3533; KYBaptistFoundation.org

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

Wednesday, May 17, 2017

Perpetuate Your Tithe

By: Laurie Valentine

Tithing is part of our Christian stewardship responsibilities. It is a discipline practiced by many all of their lives and it is vital to the continued viability of the programs and ministries of our churches.

When you die, will there be someone to “step into your shoes” to provide the funds your tithe has been providing to your church?

To assure your church will have the financial resources it needs, until the Lord returns, consider including in your estate plan a provision for the creation, at your death, of an endowment fund for the benefit of your church. Or, establish an endowment fund now to which you can make modest gifts at regular intervals during your life with provision in your estate plan for a final gift to the endowment at your death.

To create an endowment fund large enough to have sufficient earnings to fund your tithe in perpetuity requires a gift at your death (or a combination of gifts during life and at your death) equal to approximately 25 times your current annual tithe. This assumes an annual distribution rate of 4.0%.

For example, if the current amount you tithe each year is $2,000, the endowment would need to have $50,000 in it ($2,000 x 25) by the time you die. Assuming the endowment is invested to grow its value over time, the amount it will distribute to your church will also grow over time.

Assure your tithe will provide support until the Lord returns by endowing it.

Laurie Valentine is COO and Trust Counsel for the Kentucky Baptist Foundation, PO Box 436389, Louisville, KY 40253; (502) 489-3533 or 1-866-489-3533 (Toll-free, Kentucky Only); KYBaptistFoundation.org.

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

Tuesday, May 2, 2017

Four Questions When Planning a Charitable Gift

By: Richard Carnes

Have you ever considered making a legacy gift to your church or other Kentucky Baptist ministry causes? You are to be commended for your desire to build God’s Kingdom through these ministry organizations. To help plan your gift, we suggest you ask yourself the following four questions:

WHAT ASSET SHALL I GIVE?

When making a regular monthly contribution, you will likely write a check or make a cash contribution out of your income. However, if you are contributing a larger amount, cash is not necessarily the best asset. You may realize a greater tax benefit if you contribute appreciated securities—such as stocks, bonds and mutual funds—because you receive not only a charitable deduction for the market value of the contributed asset but also avoid taxation of the capital gain.

WHEN WILL I MAKE MY GIFT?

You may hesitate to make a major outright gift because you do not know what the future holds. You want to be sure you will have enough resources for prolonged care, should that be necessary, or to respond to family members who need assistance. In such cases, you may arrange the gift now but have it become effective at the end of your life.

HOW WILL I MAKE MY GIFT?

Fundamentally there are three ways to make a gift:
  1. You can give the property outright.
  2. You can arrange a future gift but retain ownership of the asset and the right to change your mind, such as through your will or a beneficiary designation. 
  3. You can transfer an asset and retain an income from it through an instrument such as a charitable remainder trust or a charitable gift annuity. 

FOR WHAT PURPOSE SHALL I MAKE MY GIFT?

You may choose to make a gift with no restrictions, allowing it to be used where it is most needed. Or, you may designate the gift for a particular purpose – such as a specific mission program, or an endowment fund.

For further assistance in answering these questions, please contact the Kentucky Baptist Foundation’s trust counsel, Laurie Valentine or me at our toll-free number (866) 489-3533.

Richard Carnes is the president of the Kentucky Baptist Foundation, P O Box 436389, Louisville, KY 40253; toll-free (866) 489-3533; KYBaptistFoundation.org.

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

Tuesday, April 18, 2017

Planning for Incapacity

By: Laurie Valentine

Estate planning is part of our Christian stewardship responsibilities. Being a good steward requires you not only plan how your assets will be distributed at death, but also how personal and financial matters will be handled in the event you become incapacitated as the result of a stroke, accident or illness such as dementia.

“Incapacity planning” must be done while you have the mental capacity to understand what you are doing. It requires careful consideration of your particular situation to best assure that the documents used and the powers granted would enable the person you are empowering to do all that needs to be done on your behalf.

A key incapacity planning document is the durable power of attorney (“DPOA”). A power of attorney is “durable” if it states: “this power of attorney shall not be affected by the disability of the principal” or words to that effect. If those words are not in the power of attorney document it cannot be used if you become incapacitated.

Both financial management powers and personal decision-making authority can be granted under a DPOA. Certain powers must be specifically granted for the person you are empowering (your “attorney-in-fact”) to have the authority to take the designated action.

Including healthcare decision-making powers makes the DPOA a “full service” incapacity planning document.

Without prior incapacity planning an expensive and time-consuming court-monitored guardianship may be the only way someone can gain authority to manage your affairs and make decisions for you if you become incapacitated.

Be a good steward and plan for your potential future incapacity now!

Laurie Valentine is COO and Trust Counsel for the Kentucky Baptist Foundation, PO Box 436389, Louisville, KY 40253; (502) 489-3533 or 1-866-489-3533 (Toll-free, Kentucky Only); KYBaptistFoundation.org.

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

Tuesday, April 4, 2017

Four Reasons An Estate Plan Is Beneficial For Everyone

It is common for people to consider how they will eventually like their assets distributed among loved ones and ministry organizations. But perhaps you have not developed a comprehensive estate plan because you think that is necessary only for the extremely wealthy. In actuality, the need for estate planning applies to everyone. A smaller estate requires even more care to avoid unnecessary expenses and retain the maximum resources for fulfilling your personal, financial, and charitable goals. Here are four key reasons why you should establish an estate plan:

1. Defining Care For Yourself – A healthcare proxy, power of attorney, and living will define how you wish to be cared for should you ever experience a period of incapacity.

2. Creating Financial Security – A will allows you to direct how you want your assets distributed and to whom, regardless of the amount. If you don’t have a personal will, state laws will determine who receives your assets.

3. Naming Guardians – If you have minor children, it’s important to make written arrangements for their care. A will is the only legally recognized way to name a person you would like to entrust with the care of your children.

4. Naming Beneficiaries – Your estate plan includes filling out beneficiary forms for assets such as insurance policies and retirement accounts. You should review your designated beneficiaries after major life events. You can also name a charitable organization as a primary beneficiary or contingent beneficiary within your plan.

A well-crafted estate plan benefits you, your loved ones, and the ministry causes you care about. Everyone needs to complete the four steps described above. Because no two situations are alike, the best course of action is to have your financial advisor and estate planning attorney review the details with you and help craft your estate plan. To make intentional plans to care for your family and the ministries God is inspiring you to support, call upon the Kentucky Baptist Foundation as a helpful partner. If you have questions, please contact the Kentucky Baptist Foundation’s trust counsel, Laurie Valentine or me at our toll-free number (866) 489-3533.

Richard Carnes is the president of the Kentucky Baptist Foundation, PO Box 436389, Louisville, KY 40253; toll-free (866) 489-3533; KYBaptistFoundation.org

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

Tuesday, March 21, 2017

Flexible Perpetual Support

By: Laurie Valentine

Is there a particular program or ministry at your church, or at a KBC- or SBC-related agency or institution, you would like to support on an on-going basis? One way to do that is to create a perpetual support (endowment) fund, the earnings of which will be used for support of the program or ministry.

The problem with that plan is you may not be able to make a single gift large enough to produce the earnings needed to start or continue the operations of the program or ministry.

The solution…a “flexible endowment fund; an arrangement under which you agree to establish an endowment fund that will, once fully funded, generate sufficient earnings to support the program or ministry in perpetuity. The total principal gift amount will depend on the financial support needed to run the program or ministry and how much of that support you wish to provide through the endowment fund. A timetable for completing the funding of the principal is agreed upon, but there is no actual schedule of payments---when you make the principal gifts during the funding period is up to you.

In addition to your agreement to make principal gifts, you also agree to provide annual “spendable” gifts to the program or ministry so that it will have the funds to operate while you complete the principal funding. The amount of your spendable gift each year is the difference between the earnings generated by the partially-funded endowment and the portion of the annual cost of the program or ministry you have agreed to support.

Flexible endowment funds---a way to provide both immediate and perpetual support for a program or ministry important to you.

Laurie Valentine is COO and Trust Counsel for the Kentucky Baptist Foundation, PO Box 436389, Louisville, KY 40253; (502) 489-3533 or 1-866-489-3533 (Toll-free, Kentucky Only); KYBaptistFoundation.org.

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.