Watchmen for Jerusalem
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A bequest is one of the most meaningful legacies you can provide for your family, friends, and Chosen People Ministries. Your bequest helps ensure that your wishes for the future of Jewish evangelism will be honored. We have been able to sustain many of today’s outreach programs due to the generosity and vision of our former supporters.
If you are planning to write your will, or if you already have one, you may want to consider these common ways to make a bequest:
Specific Dollar Amount
“I give, devise and bequeath to Chosen People Ministries, 241 E. 51st Street, New York, NY 10022, $____________ .”
Percentage of Your Estate
“I give, devise and bequeath to Chosen People Ministries, 241 E. 51st Street, New York, NY 10022, ___________% of my estate.”
Residue of Your Estate
A residuary bequest to Chosen People Ministries directs that all the residue, or a percentage of the residue, of your estate be paid to the ministry after all debts, taxes, expenses, and all other bequests have been paid.
“All the residue of my estate, including, without limitation, real and personal property, I give, devise and bequeath to Chosen People Ministries, 241 E. 51st Street, New York, NY 10022.”
Specific Asset from your Estate
“I give, devise and bequeath _______ (insert a description of the asset here, such as stocks, bonds, mutual fund shares, real estate, works of art or antiques) to Chosen People Ministries, 241 E. 51st Street, New York, NY 10022.”
You can name Chosen People Ministries to receive all or some of your estate if your primary heirs predecease you. You might do this to protect your estate from expensive litigation or from ultimate distribution to the state or unintended beneficiaries.
“If _____________ (insert the name of your heir) predecease me or disclaims any interest in ____________ (describe the asset or portion of your estate here), I give such property to Chosen People Ministries, 241 E. 51st Street, New York, NY 10022.”
A bequest can also provide life income for someone you wish to remember.
Trusts are formal legal arrangements designating a trustee to receive and hold legal title to property and administer the property according to your instructions. Trusts can arrange for any financial or administrative function.
Trusts can be very simple, or they can be as complex as necessary to meet your various financial, charitable and personal goals.
Who Might Set Up a Trust?
- Parents who want to establish a secure source of lifetime funding for a disabled or financially irresponsible child
- Owner of a closely held or family business with heirs likely to sell after inheriting
- Owner of low-dividend stocks that are worth significantly more today than when they were purchased, or majority of portfolio in employer’s company stock
- Retiring farmer with last year’s crop to sell and no expenses to offset income
- Owner of real estate or personal property free of any lien or mortgage that is not producing any income
What Types of Trusts are There?
Charitable Lead Trust
Charitable lead trusts are designed to provide income to Chosen People Ministries immediately and for a period of years, after which the property either reverts to you or passes to those you designate, typically your children or grandchildren. These trusts are most often used to transfer assets that are expected to appreciate in value to your heirs, effectively reducing gift and estate taxes. If you anticipate high estate and gift taxes, the lead trust may be an excellent vehicle for passing assets along to your heirs.
Charitable Remainder Annuity Trust
The annuity trust is similar to the unitrust with one key difference, your payments are fixed and determined at the time you establish the trust. You also receive a tax deduction upon the creation of the trust.
What are the Advantages of Making a Gift of Securities?
- You avoid all capital gains tax when you contribute long-term appreciated securities to Chosen People Ministries.
- You receive a charitable income tax deduction equal to the fair market value of the securities if they have been held longer than one year.
- The fair market value can be deducted against up to 30% of your adjusted gross income and any excess deductions can be carried forward into as many as five additional tax years.
What if You Still Need the Income Generated by the Stock?
An increasingly popular form of securities gift is a life income gift. Under such arrangements, a donor makes a gift to Chosen People Ministries but continues to receive the income earned by the donated asset. The donor designates who the income recipient or recipients will be. This is a good way to give for a donor who wants to make a gift to Chosen People Ministries now but is uncomfortable about giving up the income derived from the asset.
Stocks that yield little income but are highly appreciated are excellent choices for funding a life-income gift. You can donate these assets to Chosen People Ministries. We can then sell them without incurring the capital gains tax. With the proceeds from the sale, Chosen People Ministries can buy higher yielding stock and pay you the higher income.
A Gift Annuity is an agreement between you and Chosen People Ministries. You transfer cash or securities to Chosen People Ministries and, in return, receive fixed payments for the rest of your life. You can even name someone else the beneficiary of a gift annuity.
- Your payment amount is fixed, and guaranteed for life.
- Generally, the older you are when your gift annuity begins, the higher your payment rate. This is because a portion of your gift will be returned to you over your life expectancy.
- Payments to match your schedule: monthly, quarterly, semiannually or annually (or even deferred for a few years!)
- Chosen People Ministries is legally obligated to make payments to you for as long as you live (or the person you’ve designated to receive payments).
- A portion of your guaranteed annual payments are tax-free. As with the amount of your payments, the older you are, the greater the tax free percentage of each payment.
- You receive a federal income tax deduction in the year you make the gift.
- For gifts of publicly traded securities, you will partially avoid capital gains tax.
By using real estate to fund a gift, you may be able to make a gift to Chosen People Ministries of a size which would otherwise not have been possible. Whether it is a house, farm, vacation home, office building or plot of undeveloped land, your property can be a very helpful gift for you and for Chosen People Ministries.
A real estate gift can provide you with a combination of advantages and tax savings. Some of the benefits of a real estate gift accepted by Chosen People Ministries include:
- An immediate charitable income tax deduction in the year you make the gift.
- Avoiding capital gains taxes at the time of the transfer.
- The opportunity to live in your home or use the property for the rest of your life.
- Knowing that the property will be excluded from any estate and inheritance taxes.
Because each property and gift plan is unique, any real estate gift will require careful consideration by your legal and tax advisers. They can explain how advantageous a real estate gift can be.
There are several forms a gift of real estate can take:
An outright gift
The simplest of these is to make an outright gift. For an outright gift of real estate to occur, a deed is drawn up that transfers your property to Chosen People Ministries. Chosen People Ministries credits you with a gift equal to the fair market value of the real estate. You are eligible for a charitable income tax deduction for the property’s market value and you avoid any capital gains tax for which you might have been liable had you sold the property. You may donate an entire piece of real estate, or just a portion of it. You may also make the gift in stages. This last approach is often helpful from a tax planning perspective.
A part gift/part sale
The part gift/part sale type of real estate gift is also known as a “bargain sale” because it involves your selling property to Chosen People Ministries at a bargain price. You transfer property to Chosen People Ministries and, in exchange, Chosen People Ministries pays you an amount of money which is less than the property’s market value. The difference between the fair market value and what Chosen People Ministries pays you is considered a gift. You are eligible for a tax deduction and you avoid any capital gains tax on the portion of the transaction that is considered a gift.
A gift with a retained right to income
You can donate your property to Chosen People Ministries and, in exchange, Chosen People Ministries agrees to make annual income payments to you for the rest of your life and to a survivor beneficiary for his or her life. The amount of income you receive depends on the value of the property you donate and the ages of the income beneficiaries. For this type of gift you receive a tax deduction on a portion of the market value of the real estate and generally avoid the capital gains tax. Many people use life income gifts to convert a non-income producing asset, such as real estate, to one that produces an income stream.
A gift with a retained right to live in the donated property
You can transfer your home to Chosen People Ministries and specify in the deed that you are retaining the right to live in the house for the rest of your life or until you decide to leave it. You and Chosen People Ministries sign an agreement which spells out each party’s responsibility with regard to the property. The donor usually continues to be responsible for all expenses except major repairs. At the time you transfer the property to Chosen People Ministries, you receive a tax deduction for a portion of the market value of the property
A gift through your will
You can designate this gift as a specific bequest in your will. On your death, the real estate will be transferred to Chosen People Ministries, or in some instances the estate will sell the property and transfer the proceeds from the sale to Chosen People Ministries. Your estate will receive a charitable tax deduction for the value of the real estate at the time of your death. The language to accomplish this through your will is simple:
I/we give the property at ______________ (insert address or brief description of the property you wish to donate) to Chosen People Ministries, a not-for-profit corporation, incorporated in the state of New York.