One of the best features of making a bequest to your favorite charity is the ease in which you can do it. Many people are under the false impression that the only way to make a bequest to charity is by hiring a lawyer to write or change their will. While this is probably the most common way to make a planned gift, there are other easier and less time consuming options.
One way you can easily make a planned gift is through your retirement plan assets, such as 401Ks, IRAs and KEOGHs. Simply request a beneficiary designation form from the company that has your plan and list your favorite charity as either the full or partial beneficiary. Some plans even allow you to make the change online; it doesn’t get much simpler than that.
Retirement plans are highly taxable (subject to both income and estate tax) when given to anyone except your spouse. If you leave these assets to your heirs, a significant portion will never make it into their hands because it will be taxed. However, if you decide to leave your retirement assets to charity, the charity will receive the full amount of the retirement account tax free.
Life insurance policies are also easy planned gifts to make. Many people buy life insurance policies for particular times of their lives (most commonly for when their children are young). When those specific periods are over, there is often no longer a great need for their policy anymore. Like retirement plan assets, life insurance policies can be made into planned gifts by requesting the change of beneficiary form from your policy holder and listing your favorite charity as the full or partial beneficiary. Or you can simply transfer ownership of the policy over to your favorite charity. In irrevocably transferring your life insurance policy to charity you can claim an income tax deduction for the policy’s cost basis or cash surrender value, whichever is less.
The most important thing to remember about leaving a planned gift to your favorite charity is that if you have a desire to do so, there will always be a way for you to make it work.
If you have any questions or would like to talk with someone about the prospect of leaving the Sisters of St. Joseph of Carondelet Ministries Foundation in your estate plan, please contact Lisse Regehr, Planned Giving Officer, at 651.690.7092 or lregehr@csjstpaul.org
