Gift Annuity Update

By: Richard Carnes

At the recent 33rd Conference on Gift Annuities, the American Council on Gift Annuities announced new suggested maximum gift annuity rates to take effect July 1, 2018. The new rates reflect an adjustment upward in most rates since the last set of suggested rates became effective in 2012.

A charitable gift annuity enables the donor to make a contribution that might otherwise come through their estate, while also retaining significant benefits today. When a donor establishes a gift annuity through an organization like the Kentucky Baptist Foundation, the property that funds the gift annuity is eventually used for the charitable ministry purpose that the donor designates, just as if the donor had left a bequest by will. But unlike a bequest, a gift annuity will provide the donor with regular payments and other benefits for as long as they live.

Under the terms of a gift annuity the donor can make a charitable gift with cash or other property. The donor or others they designate then receives fixed payments for life. The amount and frequency of the payments are determined at the time the gift annuity is funded. Also, the payments will never change and are designed to continue regardless of how long you live.

Because a portion of the gift annuity will be used for charitable purposes, the donor is entitled to an income tax deduction for the year of gift. Additionally, for a period of time, part of each payment may be received free of income tax or be taxed at capital gains tax rates that may be significantly lower than rates paid on other income.

You may wish to consider arranging a future charitable gift by establishing a gift annuity that results in immediate tax and other financial benefits. By doing so, you may be able to enjoy tax savings and increased income today while providing for a significant charitable gift to a favorite Baptist ministry.

To seek assistance in creating a charitable gift annuity that will ultimately provide support for Baptist causes and learn more about the recent gift annuity rate changes, contact the Kentucky Baptist Foundation at our toll-free number (866) 489-3533.

Richard Carnes is 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.

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.

Flexible Life Income Gift

By: Laurie Valentine

Are the “minimum distribution rules” requiring you to take more from your IRA than you currently need for living expenses? Are you interested in establishing a charitable gift plan that will ultimately provide a significant gift to one or more charitable causes, while allowing you to “tap in” to an income stream at a later age?

A “flexible deferred charitable gift annuity” may be the way to solve your problem and accomplish your charitable giving objectives.

A deferred charitable gift annuity is gift plan in which a charity agrees, in exchange for a gift of cash, appreciated securities or real estate, to make fixed payments to the giver and/or one other person for their lifetime(s) beginning at least one year and one day after the gift is made. At the death of the “life income” beneficiary(s), whatever remains is paid out to the charitable cause(s) the giver designated.

While the annuity payments don’t start for a year or more, the giver is entitled to a charitable income tax deduction in the year the gift is made to the charity.

A “flexible deferred charitable gift annuity” offers an additional benefit. Instead of designating a particular, unchangeable start date for the annuity payments, the flexible gift annuity contract reserves to the giver the right to postpone the decision about the actual annuity payment start date until later.

Your charitable income tax deduction will be determined using the earliest date on which you can “turn on” the annuity payments. And, the annuity payment amount will vary depending on when you elect to start the payments…the longer you wait, the higher the annuity payment amount.

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.

Giving Now and Later

By: Richard Carnes

Some individuals strongly desire to establish plans to make a legacy gift now, but they are hesitant about giving up the annual income stream from the asset they are considering gifting to a Baptist ministry cause. One effective way to both make a gift and retain a fixed payment for life is through establishing a charitable gift annuity.

A gift annuity enables the donor to make a contribution that might otherwise come through their estate, while also retaining significant benefits today. When a donor establishes a gift annuity through an organization like the Kentucky Baptist Foundation, the property that funds the gift annuity is eventually used for the charitable ministry purpose that the donor designates, just as if the donor had left a bequest by will. But unlike a bequest, a gift annuity will provide the donor with regular payments and other benefits for as long as they live.

Under the terms of a gift annuity the donor can make a charitable gift with cash or other property. The donor or others they designate then receive fixed payments for life. The amount and frequency of the payments are determined at the time the gift annuity is funded. Also, the payments will never change and are designed to continue regardless of how long you live.

Because a portion of the gift annuity will be used for charitable purposes, the donor is entitled to an income tax deduction for the year of gift. Additionally, for a period of time, part of each payment may be received free of income tax, or be taxed at capital gains tax rates that may be significantly lower than rates paid on other income.

To summarize, the benefits for the donor considering this type of legacy gift plan are as follows:

· The satisfaction of making an important contribution to a Baptist ministry in which you believe.

· Fixed payments for life.

· An immediate income tax deduction

· A partial bypass of capital gains tax

· An extended payment of any capital gains tax due

· Partially tax-free payments for a number of years

· Removal of assets from the donor’s taxable estate while continuing to enjoy lifetime payments

To seek assistance in creating a charitable gift annuity that will ultimately provide support for worthy Baptist causes, 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, 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.

Do You Need More Income?

By: Barry G. Allen- President & CEO

Like many people you may depend upon income from certificates of deposit and other fixed income investments.

If so, I am confident you wish interest rates were a lot higher than they are. Also, you may have been thinking about how to provide some kind of financial benefit to your church and other charitable causes, but did not feel you could give up that income producing CD.

I am delighted to inform you the Kentucky Baptist Foundation offers you a simple solution to your need of more income and your charitable intentions. That solution is a charitable gift annuity (CGA).

A CGA is an agreement between you and the KBF under which, in exchange for your gift to the KBF of cash or appreciated securities with a value of at least $5,000, the KBF agrees to pay you a fixed amount each quarter for the rest of your life. The payout rate depends upon your age. The older you are, the higher the payout rate.

Also, a CGA can be on one or two lives. For example, it can be on the lives of a husband and wife.

Not only is the payout partially tax free, but also the gift portion of the plan is tax deductible. If you give appreciated assets, there likely will be capital gains tax savings as well.

The portion of your gift not needed to make the lifetime annuity payments to you will be available at your death for the chartable cause(s) you designate in advance.

You can specify for the remaining portion to be available to the charitable cause(s) outright, or to be held by the KBF in a permanent endowment fund with only the earnings, not the principal, being paid in perpetuity to the cause(s).

Anyone age 50 or older is eligible. Example of the current single life payout rates are: 5.1% at age 70; 5.8% at age 75; 6.8% at age 80; 7.8% at age 85; and 9.0% at age 90 and older.

As you anticipate the maturity of your next CD, consider using it for a CGA. Laurie Valentine and I are awaiting your toll free call to assist you.

For more information, please call us at (502) 489-3533 or toll free in KY at 1(866) 489-3533.

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.

An Income For Life, a Legacy Beyond Life

By: Barry G. Allen- President & CEO

I recently received a letter from a 96 year old donor who had set up a charitable gift annuity 16 years ago when she was in her 80’s. She stated “I am 96 years young and want to give a gift to my church that will live on in my memory.” And she wanted to set up another charitable gift annuity and for the benefit of the church of which she has been a member for 83 years. What an inspiration! And what insight she has exhibited in using this unique form of giving to leave a legacy of her love for Christ and His mission in the world through her church while receiving income for the remainder of her life.

Like her, you may depend upon income from certificates of deposit. If so, you wish interest rates were a lot higher than they are. You also may have been thinking about how to provide some kind of financial benefit to your church and/or other charitable causes, but do not feel you can give-up that income-producing CD.

I am happy to inform you the Kentucky Baptist Foundation offers you the same solution this woman has used. That solution is a charitable gift annuity (CGA). A CGA is an agreement between you and the Foundation under which, in exchange for your gift to the Foundation of cash or appreciated assets with a value of at least $5,000, the Foundation agrees to pay you a fixed amount each year for the rest of your life. The payout rate depends upon your age. The older you are, the higher the rate. Also, a CGA can be on one or two lives. It can be on the lives of a husband and wife, or a parent and a child. Not only is the payout partially tax-free, but also the gift is tax deducible. If you give appreciated assets, instead of cash, there likely will be capital gains tax savings. The portion of your gift not needed to make the lifetime annuity payments to you will be available at death for the cause(s) you designate in advance. You can specify for that remaining portion to be available to the charitable causes(s) outright or to be held by the Foundation in a permanent endowment fund with only the earnings, not the principal, being paid to the cause(s) in perpetuity. Anyone age 50 or older is eligible. The one-life rates range from 3.7% at age 50 to 9.0% at age 90+. Other rates are: 4.7% at 65; 5.8% at 75; 7.8% at 85.

As you anticipate the maturity of your CD, consider using it for a CGA, which will provide an income for life and a legacy beyond life. Laurie Valentine and I are awaiting your toll-free call.

For more information, please call us at (502) 489-3533 or toll free in KY at 1(866) 489-3533.

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.

12 Things to do in 2013- Need More Retirement Income?

12 Things to do in 2013- Laurie Valentine #10

Have you determined you may need more income when you retire than will be provided by social security, IRA’s and your investments? A deferred payment charitable gift annuity may be the answer.

A charitable gift annuity is a gift arrangement whereby you make an irrevocable gift to a charity of your choice and retain the right for you (or you and one other person) to receive fixed, never-changing payments for the rest of your lives. At your death, whatever is left is paid to the charity. The future gift to charity is a charitable contribution for which an income tax deduction may be available.

A deferred payment gift annuity is set up and funded now, but the lifetime payments to you don’t start until a future date chosen by you.

The size of the payment you will receive is determined by the amount of your gift, your age at the time of the gift and how long your payments are deferred. Generally, the more time between the gift date and the first payment date the higher the payments to you will be.

You cannot outlive your payments, and the payment amount will not change regardless of changes in interest rates or the economy.

You can fund a deferred payment gift annuity with cash, stocks, bonds or other securities.

If you are 60 and plan to retire at age 70, your deferred payout rate is 7.0%. For every $10,000 you give now, you will receive $700 each year beginning at age 70, and the value of your charitable gift for income tax deduction purposes is 45% of the value of what you give.

For comparison, the immediate gift annuity rate for a 60 year old is 4.4%, the annual payment for every $10,000 given would be $440, and only 29% of the value of what you give is a “charitable gift” for deduction purposes.

For more information, please call us at (502) 489-3533 or toll free in KY at 1(866) 489-3533

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.

Charitable Gift Annuities

By: Laurie Valentine, COO & Trust Counsel
Would you like to provide support to your church or another favorite Baptist cause while benefiting from lifetime payments, 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 a fixed amount each year for your lifetime. The lifetime payments to you are backed by the general assets of the cause(s) that will ultimately benefit from your gift.

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

Establishing a charitable gift annuity during your lifetime allows you to provide for your financial needs and those of your family, while at the same time assuring vital future support to the causes you designate to ultimately benefit from your gift.

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. These benefits can make the cost of establishing a charitable gift annuity very reasonable.

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

For more information, please call us at (502) 489-3533 or toll free in KY at 1-(866) 489-3533

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.

E-Devotional- Week 30

Creative Giving Ideas- Week 4

Life Income Gifts

The churches, associations, institutions and agencies of the Kentucky Baptist Convention and Southern Baptist Convention are making a difference for the Kingdom of God in our state, nation and around the world.  They are worthy of significant and sacrificial support that will enhance and undergird their missions and ministries.

Perhaps you would like to make gifts above what you give out of income as tithes and offerings to provide on-going support to one or more of these causes, but you may be concerned that such gifts could affect your financial security and that of your family.  This lesson provides ideas on how you can make a gift that will ultimately benefit causes that are important to you, while retaining the right to receive an income for life for yourself and/or others.

Scripture Reference:  2 Corinthians 9: 6-15; 1 Timothy 6:17-19.

Please read these passages in your Bible now.

Does Giving Have to Be  “All or Nothing”?

Making gifts for the benefit of your church or other Baptist causes does not have to be an “all or nothing” proposition.  There are a number of giving options that allow you to make a charitable gift either during your lifetime or at death, while retaining the right for you and/or others to receive income for life or a term of years.  Charitable gift annuities and charitable remainder trusts are “life income gift” options.

What is a Charitable Gift Annuity?

A charitable gift annuity is a simple contract between you and the Kentucky Baptist Foundation under which we agree to pay you (or you and one other person) a fixed amount (the “annuity”) each year for your lifetime(s), in exchange for your gift of cash or appreciated stocks, bonds or mutual fund shares.  The payments are backed by the assets of the benefiting organization; they’ll be paid no matter what happens to the investment of your gift.  At death, the remaining balance can be distributed to whatever Baptist causes you specify or used to establish (or add to) a permanent endowment fund in your name the income from which will be divided among the causes you designate.

The payment rate is determined by your age at the time you make the gift; the older you are, the higher the payment rate.  For example, the payment rate for a 60-year-old is 4.4%; for a 70-year-old it is 5.1%; for an 80-year-old it is 6.8%; and for someone age 90 or older it is 9.0%.

The amount of the annuity payments is determined by multiplying the payment rate designated for the person(s) who will receive the payments (the “annuitant”) by the value of what you gift.

What are the Benefits of a Charitable Gift Annuity?

}Income that cannot shrink and that you cannot outlive.  The payments are fixed at the time you make the gift and will never vary, no matter what the actual investment performance of what you give.  They will continue to be paid no matter how long you and/or the other annuitant live.

}A portion of the annuity payment amounts you receive each year is not taxable to you.  This may result in an increase in your cash flow, but not your taxable income.  In these days of lower interest rates and smaller stock dividends, increasing the cash in your pocket, but not your income tax bill may be very appealing.

}An immediate income tax deduction is allowable in the year you make the gift equal to the present value of the charity’s interest.

Here’s an example:  Martha Smith, age 70, makes a gift of $5,000 from a matured Certificate of Deposit (CD) to the Kentucky Baptist Foundation in exchange for a 5.1% charitable gift annuity (5.1% is the payment rate for a person age 70).  Martha will receive $255 per year for the rest of her life---a 155% increase over the $100 per year CD interest she has been earning on this money.  Only $50 of the $255 annuity amount she will receive each year will be taxable income, the remaining $205 is received by Martha tax-free---her taxable income has actually decreased, even though her cash flow has increased.  The value of her charitable contribution for tax deduction purposes is $1,735.

Use our planned giving calculator http://www.kybaptist.planyourlegacy.org/GIFTcharitg.php to calculate the benefits to you of creating a charitable gift annuity for the ultimate benefit of your church or other Baptist causes.

What is a Charitable Remainder Trust?

A charitable remainder trust is an arrangement whereby you, as donor, transfer cash, investments or real estate to an irrevocable trust which you set up to pay you (or you and/or others) a designated income stream for life or a term of years.  At your death, or the end of the term of years, whatever remains in the trust is distributed to the charitable causes you have named in the trust agreement.

There are two options for the income stream you can receive.  If you want to receive a fixed payment that is determined at the time the trust is created and never changes, a Charitable Remainder Annuity Trust is the choice for you.  If you would prefer a payment that varies with the investment performance of the trust assets, a Charitable Remainder Unitrust which pays you an amount each year equal to a designated percentage of the value of the trust assets, as revalued each year, is the option that will meet your objectives.

What are the Benefits of a Charitable Remainder Trust?

}Diversification of assets without incurring capital gains taxes.  You may be faced with the fact that one of your holdings has increased in value to the point that it makes up too large a portion of your estate---to many “eggs” are in one basket---or you may have assets that are highly appreciated but are no longer yielding much income or which have become a nuisance to manage.  If you sell a highly appreciated asset, you will be taxed on the capital gain, thereby leaving you with less than the full value of the asset for future investment/use.  Gifting the appreciated asset to a charitable remainder trust is not treated as a sale, so there is no recognition of gain.  When the charitable remainder trust sells the asset, the trust pays no capital gains taxes because it is tax-exempt.  The result---the full value of the gifted asset(s) remains in the trust to produce the income stream you and/or others will receive.

}Potential increase in your cash flow.  The payout rate you select (the law mandates that the rate be at least 5%) may result in payments to you from the trust of larger amounts than the asset(s) you gift were paying.

}An immediate income tax deduction is allowable in the year the gift is made equal to the present value of the charitable remainder interest.

Here’s an example:  Martha Smith, age 70, and her husband, Sam, age 72, own a vacation home in another state which they bought many years ago for $25,000.  Its current market value is $75,000.  Health issues are limiting their ability to continue to use the vacation home; however, they know that if they sell the property they’ll have $50,000 of capital gains on which they’ll owe capital gains taxes.  If they gift the property to a 5% charitable remainder unitrust, their first year’s income from the trust will be $3,750 (5% x $75,000), they will be entitled to a charitable income tax deduction of $31,780 and they will avoid $7,500 of capital gains taxes.  When the trust sells the real estate, the full amount of the sale proceeds will be retained by the trust, it will not owe any capital gains taxes, because it is tax-exempt.  If the sale proceeds are invested to earn an average annual return of 5.5%, Martha and Sam will receive approximately $68,500 over their 19-year joint life expectancy and there will be approximately $69,000 left to be distributed to the designated Baptist causes at the survivor’s death, if at least one of them lives for the full 19 years.

Use our planned giving calculator http://www.kybaptist.planyourlegacy.org/GIFTcharituni.php to calculate the benefits to you of creating a charitable remainder trust for the ultimate benefit of your church or other Baptist causes.

Prayer Focus: Take time now to pray for God’s guidance as you consider whether a life income gift is the way that you can make a lasting difference in this world for the cause of Jesus Christ.

For more information, please call us at (502) 489-3533 or toll free in KY at 1-(866) 489-3533

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.

Charitable Gift Annuities

By: Laurie Valentine, COO & Trust Counsel

Would you like to provide support to your church or another favorite Baptist cause while benefiting from lifetime payments, 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 a fixed amount each year for your lifetime. The lifetime payments to you are backed by the general assets of the cause(s) that will ultimately benefit from your gift.

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

Establishing a charitable gift annuity during your lifetime allows you to provide for your financial needs and those of your family, while at the same time assuring vital future support to the causes you designate to ultimately benefit from your gift.

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. These benefits can make the cost of establishing a charitable gift annuity very reasonable.

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

For more information, please call us at (502) 489-3533 or toll free in KY at 1-(866) 489-3533

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.

Ways to Give to Baptist Causes

By: Laurie Valentine-COO & Trust Counsel 

Your church, association and the Kentucky Baptist Convention and its agencies and institutions have a wide variety of important ministries that need financial support to launch them into reality or to continue or expand their existing programming. The methods by which you may support these important causes through legacy giving (giving out of your assets, rather than your income) are also wide-ranging.

An outright gift of cash, appreciated securities or real estate is probably the most common, and simplest, way to make gifts during your lifetime.

Other methods of lifetime giving, such as charitable gift annuities and charitable remainder trusts, allow you to provide a future benefit to one or more Baptist causes while retaining an annual income for your lifetime or a term of years.

There are also a variety of methods you can arrange now to benefit the causes of your choice at your death. The most common is a bequest in your Will or Living Trust. Another possibility is to name a Baptist cause as the beneficiary of some portion of your IRA or a life insurance policy no longer needed for family security.

You can designate your gift be used for a specific program or ministry of the benefiting organization, rather than giving the organization the choice of how to use your gift. You may also want to limit the organization to using only the earnings off what you give (this type of arrangement is called an “endowment fund”).

Gifts may be made directly to the benefiting organization or may be given to a third party, such as the Kentucky Baptist Foundation, to manage for the designated beneficiary cause or causes.

For more information, please call us at (502) 489-3533 or toll free in KY at 1-(866) 489-3533

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.

Need More Retirement Income?

By: Barry G. Allen- President & CEO

If you have not retired and would like to supplement your income once you do retire when you might need the additional income, a deferred payment charitable gift annuity is worthy of your consideration.

The most common form of a charitable gift annuity allows you to make a gift that provides immediate payments to you for life. With a deferred payment annuity you can fund the gift arrangement now but choose to begin the payments at some future date. Because a portion of your gift will be used for the charitable purpose(s) of your choice upon your death, you will be entitled to a tax deduction in the year you make the gift. When you begin receiving payments in the future part of each payment will be tax free over your life expectancy.

The size of the payment you will receive is determined by the amount of your gift, your age at the time of the gift and how long your payments are deferred. Generally, the more time between the gift date and the first payment date the higher the payment will be.

You cannot outlive your payments, and the payment amount will not change regardless of changes in interest rates or the economy. Also, you can designate another person to receive payments with you, instead of you, or following your death, which is a great way to provide income for a spouse or other loved ones or a friend. Because the combined life expectancy of two typically is longer than one, the payment amount will be lower. You can fund this arrangement with cash, stocks, bonds or other securities. You can avoid or delay capital gain taxes by using appreciated securities.

If you are 60 and plan to retire at age 70, your deferred payout rate is 7.0%. For every $10,000 you give now, you will receive $700 each year beginning at age 70. For comparison, the immediate gift annuity rate is 5.1%, and the annual payment for every $10,000 given would be $510.

Call Laurie Valentine or me for a customized illustration of a deferred payment charitable gift annuity for you.

(502) 489-3533 or toll free in KY at 1-(866) 489-3533

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.

Advancing the Kingdom Through Legacy Giving

By: Laurie Valentine- COO & Trust Counsel

Your church, association and the Kentucky Baptist Convention and its agencies and institutions have a wide variety of important ministries that need financial support. Some may need funding to launch them into reality while others could use the support to continue or expand an existing program or ministry. The methods by which you may support these important causes through legacy giving (giving out of your assets, rather than your income) are also wide-ranging.

An outright gift of cash, appreciated securities or real estate is probably the most common, and simplest, way to make gifts during your lifetime.

Other methods of lifetime giving, such as charitable gift annuities and charitable remainder trusts, allow you to set up a future benefit to one or more Baptist causes while retaining an annual income for your lifetime or a term of years.

There are also a variety of methods you can arrange now to benefit the causes of your choice at your death. The most common is a bequest in your Will or Living Trust. Another possibility is to name a Baptist cause as the beneficiary of some portion of your retirement plan survivor benefit, IRA or a life insurance policy no longer needed for family security.

You can designate your gift be used for a specific program or ministry of the benefiting organization or you can allow the organization to choose how to use your gift. You may also want to limit the organization to using only the earnings off what you give (this type of arrangement is called an “endowment fund”).

Gifts may be made directly to the benefiting organization or may be given to a third party, such as the Kentucky Baptist Foundation, to manage for the designated beneficiary cause or causes.

Whether you wish to make gifts during your lifetime or at death, there are a variety of ways to by which you can advance the Kingdom by including a legacy gift in your estate plan.