Planned Giving during Down Times

Planned gifts benefit Bethel and donors.

Summer 2009

In its 2008-2009 fiscal year, Bethel received $1.1 million in realized planned gifts—things such as securities, IRAs, real estate, etc.—newly settled and distributed following the death of a donor. Working with Bethel’s planned giving donors since 1997, Dan Wiersum, associate vice president and director of planned giving, has helped many give in ways that benefit them, their families, and Bethel. In the past year, Bethel has acquired nearly $3 million in new planned gifts—new gift agreements and gift plans that will eventually be distributed to Bethel through wills, trusts, or beneficiary designations.

Despite the recession, people are giving and doing so generously, Dan says. In fact, top financial advisers say there is no better time for donors and their advisers alike to be thinking about charitable giving. Charitable needs are greater than ever, and many giving strategies remain viable under the current economic conditions. Hear how—and why—from Dan.

If you want to pass wealth to your heirs as well as provide a benefit to Bethel, now is the ideal time to consider a charitable lead trust (CLT). For estate planning purposes, low valuations of assets increase the tax benefits in establishing this kind of trust.

Consider this: The federal rate on CLTs was 4.2 percent in February 2008. If at that time you had established a $1 million 20-year term charitable lead trust and designated 5 percent of its annual annuity to be paid at the end of each quarter, you would have received a gift value for tax purposes of $678,055. If established in February 2009 when the rate was 2 percent, the gift value would increase to $823,706.

Unlike the charitable remainder trust (CRT), which creates current income for the donor and a deferred gift to charity, CLTs create current gifts to charity and a deferred gift to either the donor (in the case of a grantor CLT) or the donor’s heirs (in the case of a non-grantor or family CLT).

Friends of Bethel who have appreciating assets they wish to pass on to their heirs with minimum tax liability will find this arrangement to be a significant opportunity. The benefit to Bethel is an immediate and reliable flow of income to support a program or scholarship of particular interest to the donor.

For more information, call Dan Wiersum at 651.635.8052 (800.255.8706, ext. 8052) or email d-wiersum@bethel.edu.