Friday, November 4, 2016

Gifts That Pay You Income

By: Laurie Valentine

Would you like to provide future support to your church or another favorite Baptist cause while receiving guaranteed income for the rest of your life, management of assets and tax savings? If your answer is yes, a charitable gift annuity may be just what you are looking for.

A charitable gift annuity is a contract between you and the Kentucky Baptist Foundation under which you agree to make a gift of cash or appreciated stocks, bonds or mutual fund shares and, in exchange for your gift, the Kentucky Baptist Foundation agrees to pay you (or you and one other person) a fixed amount each year (“annuity”) for the rest of your life.

The annuity payment amount depends upon the value of what you give and your age at the time you make the gift. The older you are the higher the payment rate. The annuity payment amount is not dependent on what your gift earns.

At your death, whatever is left of your gift is distributed to the charitable cause or causes you have named to be used as you direct.

Tax savings may be available from the charitable income tax deduction that is allowable and also from the fact that part of each payment you receive is tax-free. Those tax benefits can make the cost of making a charitable gift annuity gift very reasonable.

Using appreciated stocks, bonds or mutual fund shares to establish a charitable gift annuity can also provide capital gains tax savings.

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.

Thursday, November 3, 2016

Year End Giving



By: Richard Carnes

Making charitable gifts is not only an opportunity for you to make a difference in your community through a favorite charitable ministry; it’s also an excellent way to reduce your tax burden for the year. 

A tax deduction for charitable giving isn’t guaranteed just because you’re generous. As with everything in tax law, it’s important to follow the rules. By doing so, you can help ensure that your donations result in maximum benefits for you and the chosen charitable organizations you support through your gifts.

The Internal Revenue Service offers the following reminders to help taxpayers plan their gifts to charity:

· Qualified charities. Only donations to eligible organizations are tax-deductible. Select Check, a searchable online tool available on IRS.gov, lists most organizations that are eligible to receive deductible contributions. In addition, churches are eligible to receive deductible donations. That is true even if they are not listed in the tool’s database.

· Year-end gifts. Contributions are deductible in the year made. Donations by check count for 2016 as long as they are mailed in 2016. Also, donations charged to a credit card before the end of 2016 count for 2016, even if the credit card bill isn’t paid until 2017.

· Itemize deductions. For individuals, only taxpayers who itemize their deductions on Form 1040 Schedule A can claim deductions for charitable contributions. This deduction is not available to individuals who choose the standard deduction.

· Record donations. The long-standing requirement of the IRS is that a taxpayer obtain an acknowledgement from a charity for each deductible donation (either cash or property) of $250 or more. Also, be aware that additional rules apply for a property contribution of $250 or more.

As you begin to look beyond 2016, you may also wish to consider arranging for future charitable gifts that result in immediate tax and other financial benefits. By doing so, you may be able to enjoy tax savings, increased income and other financial advantages today while providing for a significant charitable gift to a favorite Baptist ministry as part of your long-range planning.

If you have questions about these gift-planning strategies, please call the Foundation’s trust counsel, Laurie Valentine or me at our toll-free number, (866) 489-3533.

Richard Carnes is 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.