Ways to Give
The bequest is the most popular type of planned gift, accounting for more than 80% of all gifts from wills or trusts. The gift is made by naming the church or charity to receive a gift through your will or living trust. The gift may also be made by preparing a codicil to your will.
Bequests are revocable gifts, that is, they can be changed by the donor or trustee. Be sure to use the legal name of the church or charity in the gift language. This sample bequest language will ensure your gift is made as you intend.
- Charitable Gift Annuity
A charitable gift annuity is a contract between the donor and the church or charity. The donor transfers cash or securities to the charity in exchange for a regular, fixed amount of income for life – and perhaps for one additional life, like a spouse.
The rate of interest is determined based on the age of the donor(s) when the gift is made. This makes the gift especially attractive for older donors.
Gift annuities are irrevocable gifts, that is, they cannot be changed after the gift is established. The trade-off is a tax deduction at the time of the gift. A portion of the annual income received may also be tax-free.
The church or charity receives the remainder of the annuity after the death of income beneficiaries.
Your United Methodist Foundation administers a charitable gift annuity program for benefit of United Methodists and the churches of northern Illinois Conference. Learn more about our program
Obtain current gift annuity rates for one- or two- lives or this gift annuity fact sheet which also includes stories from some NIC annuitants. Our Annuity application is straight forward. Please contact us for a customized, no obligation proposal that will give important tax and rate details for your situation.
- Charitable Remainder Trusts (CRT)
The donor funds a trust which provides an income stream for one or more persons for life or for a term of years. Charitable trusts are particularly useful for large gifts of appreciated assets.
In addition to income, trusts provide an immediate charitable deduction when the trust is funded. It provides more flexibility than a gift annuity, and it requires a formal trust agreement be prepared and executed.
In some cases the Foundation will consider acting as trustee of a CRT. Contact us for details. When the trust ends, the principal passes to the church, and perhaps other charities, as indicated in the trust agreement.
- Retained Life Estate
The donor gives real estate, usually one’s home or farm, to the church and retains the use of the property for their lifetime or for a period of time. The donor agrees to maintain the property and pay the taxes while they continue to live in the home or use the farm.
A charitable tax deduction is received for the charitable portion of the gift. This gift option may be attractive for donors whose family no longer lives in the area and has no use for the property.
- Charitable Lead Trusts
The donor funds this trust which provides the church, and perhaps additional charities, with income for a period of years. At the end of the term, the remaining principal is paid to the donor or to their heirs.
This giving option is used for large estates as a wealth transfer vehicle more than a charitable vehicle. It is used to pass certain assets to heirs at a future time and a reduced cost. Unlike Charitable Remainder Trusts, a Lead Trust is subject to taxes.
- Create an Endowment Fund
A donor or family may create a permanent endowment fund, with the earnings of the fund specified for purposes named by the donor.
This giving strategy can provide on-going support for a favorite ministry in perpetuity.
What to Give
- Gifts of Cash
This is the simplest way to give. An immediate charitable tax deduction is received when the gift is made.
Gifts of publicly traded stocks, especially those with appreciated value or low yield, make excellent charitable gifts. These gifts bypass capital gains tax and offer charitable tax deductions.
- Life Insurance
A donor may give a life insurance policy to the church or name the church as the death beneficiary. A life insurance policy which is no longer needed by the donor can enable a significant gift to the church with little expenditure to the donor.
A charitable tax deduction may be taken when the donor transfers ownership of the policy to the church. No deduction is available when the charity is named as beneficiary.
- Real Estate
Gifts of debt-free property, especially when the value has greatly appreciated, make excellent charitable gifts. Property can be deeded outright or transferred through the donor’s will or estate.If the property is deeded outright to the church, the donor can avoid capital gains taxes and deduct the fair market value of the property. The donor may also decide to keep the right to use the property for their lifetime.If given through a will or trust, the property will not be a taxable portion of the estate.Contact us for other ways to use gifts of property to meet a donor’s estate planning goals.
- Retirement Plan Assets
A donor can designate the church as a beneficiary of an Individual Retirement Account or a 401-K plan. Because these assets have never been taxed, leaving them to family or friends through your will or trust can incur very significant taxes. Careful planning of the distribution of these assets can avoid adverse tax results and provide a significant gift to the church after your death. Contact us for more information on any of these giving plans.
Those considering a gift are urged to consult an attorney, accountant or financial planner before finalizing a planned gift.