Tax ID number 56-2211824
[Nanda Maharaja to Uddhava:] "Wherever we are made to wander about this world by the Supreme Lord's will, in accordance with the reactions to our fruitive work, may our good works and charity always grant us love for Lord Krsna." Srimad Bhagavatam 10.47.67
Charitable trusts enable you to make a gift which benefits you/and or your loved ones and Bhaktivedanta College. You may also substantially reduce estate and inheritance taxes when you establish a trust.
Trusts may be established during your lifetime (inter vivo) or through your will (testamentary). Following are some of the more popular charitable trust options.
Charitable Remainder Trust
A Charitable Remainder Trust offers you a way to make a sizeable charitable gift now and still have income for life. You will have the personal satisfaction of making a generous gift to Bhaktivedanta College while receiving substantial tax benefits. Bhaktivedanta College offers two basic types of charitable remainder trusts: the Annuity Trust and the Unitrust.
An Annuity Trust provides income to your and /or another beneficiary for life or for a period not to exceed 20 years. At the termination of the trust, the remainder passes to Bhaktivedanta College.
When you irrevocably transfer a gift to a charitable remainder annuity trust, the income you receive every year is a fixed dollar amount. Payments may be made on a quarterly basis and your return must be at least 5% of the initial amount contributed. The responsibility for managing and investing your trust fund is assumed by professional managers of your choice.
If you use appreciated assets to fund your trust, you eliminate capital gains tax. Your are entitled to a significant charitable tax deduction at the time the gift is made. If the deduction is greater than the amount permitted for an individual in a given year, the excess may be carried forward for an additional five years.
The unitrust is a flexible, tax advantageous method of making a generous gift to Bhaktivedanta College. It carries the same income and tax advantages as an annuity trust. As an estate planning tool, the unitrust can provide the following:
- Income for life
- Immediate and substantial income tax savings
- Allows you to convert an appreciated low-interest investment into a high income investment without incurring a capital gains tax
- Minimizes estate taxes and probate cost.
These benefits can be a sound personal investment to you, as well as a generous gift to Bhaktivedanta College.
When you irrevocably transfer a gift to a unitrust, the income you receive is a fixed percentage of the value of the assets. The percentage specified must be at least five percent, although you can select a higher rate.
This percentage is applied to the value of the trust assets as determined annually. Payments are made quarterly during your lifetime, or for a term of years to last no longer than 20 years. Once a unitrust has been established, you may add to it at any time. Each addition entitles you to a charitable deduction in the year given.
The Gift Annuity
A gift annuity is a combination of a gift and an investment, whereby, in exchange for your gift, you and /or your beneficiary(ies) are guaranteed a fixed income for life.
The amount of income is determined by two factors: your age and the size of your gift. Your annual income is fixed at the time of the gift and remains stable throughout your life. Rates of return offered by Bhaktivedanta College follow those recommended by the Committee of Gift Annuities, a group representing most educational and philanthropic organizations in the United States.
In addition to providing a guaranteed income, the gift annuity also offers significant tax advantages. You are entitled to an immediate charitable tax deduction for the gift portion. Furthermore, the portion of each annuity payment that represents your investment is not taxable. This tax-free portion will often exceed 50 percent. Your payments are mailed to you at the interval you select: quarterly, semi-annually or annually.
Gift of Real Estate
You can create sizable tax savings by giving a gift of real estate to Bhaktivedanta College. Gifts of real estate may eliminate potential problems associated with the settlement of estates such as a quick sale of the real estate (at less than fair market value) to provide cash for payment of estate and inheritance taxes or for the cost associated with the administration of the estate.
Gifts of Real estate can consist of almost any type of property: a personal or recreational residence, a farm or ranch, a commercial building, subdivision lots, or any undeveloped parcel of land. The gift can be the entire property or an interest of the property (50%, for example).
Individual financial needs and goals will determine which of the following methods of giving real estate is most appropriate to your situation.
An Outright Gift. The property is deeded to Bhaktivedanta College and subsequently sold unless there is a special reason for holding the real property.
Bequest. You may give real estate to Bhaktivedanta College under the terms of your will by using any of the vehicles discussed earlier with respect to lifetime gifts.
A Retained Life Income. Your gift of real property is transferred to a Charitable Remainder Trust from which it is sold and the proceeds are used to pay you an income. The life long annual income paid to you and/or another depends upon the net proceeds realized on the sale of the real estate and the previously agreed upon rate of return. At the death of the life beneficiary or beneficiaries, the assets of the trust pass to Bhaktivedanta College.
A Retained Life Tenancy Gift. Ownership of the real property is transferred to Bhaktivedanta College, but you retain the right to use the property for your life time. You also receive a charitable income tax deduction for the value of your gift. Upon the death of the "life tenant", the property becomes a part of Bhaktivedanta College Endowment.
Gifts of Life Insurance
Life insurance offers an attractive method for making a substantial gift to Bhaktivedanta College. There are several ways to use life insurance for charitable purposes. For example, you may:
- Liquidate a policy no longer needed for family protection and give the proceeds to Bhaktivedanta College.
- Give a policy that is not fully paid up and take a deduction for the "present value" of the policy, or the approximate cash surrender value. If you then continue to pay the premiums to maintain the policy in force, you will be able to deduct the premium payments as charitable contributions.
- Use life insurance as a "replacement" asset. You give appreciated property to Bhaktivedanta College now and replace the dollar value of the asset with life insurance for your family. The income tax savings from your gift may be sufficient to pay for "replacement" insurance.
A planned gift to Bhaktivedanta College accomplishes multiple goals. Its a means by which you can share your good fortune with others, provide financial security for yourself and your family and support an institution whose mission benefits all mankind.
We know that such a gift is not to be made casually and encourage you to seek the advice of your financial adviser. If you or your advisor have any questions, regarding gift options listed above, please write:
P.O. Box 1942
Sylva, NC, 28779
The information on this subject illustrates ways of making outright and planned gifts to Bhaktivedanta College under present tax regulations. Since the application of these tax saving to a particular case is affected by your personal circumstances and the laws of your State, Bhaktivedanta College urges you to consult your attorney or tax consultant when planning your gift.
"Charity given out of duty, without expectation of return, at the proper time and place, and to a worthy person is considered to be in the mode of goodness." Bhagavad-gita 17.20