Types of Gifts

Bequests
Making a gift to Trinitas in your will creates a wonderful legacy that will help secure the future of health care in Eastern Union County. If you are not ready to redraft your entire will, you can also make a bequest in a codicil. If you have a living trust, you can include your bequest there.

Following is some sample bequest language:

I give $__ to the Trinitas Health Foundation, located in Elizabeth, New Jersey, to use for its general purposes or as its Board of Trustees directs.

I give __ shares of ___________ stock to the Trinitas Health Foundation, located in Elizabeth, New Jersey, to use for its general purposes or as its Board of Trustees directs.

I give __ percent of the remainder of my estate to the Trinitas Health Foundation, located in Elizabeth, New Jersey, to use for its general purposes or as its Board of Trustees directs.

You can also create a trust or give specific property in your will.

Example: Mrs.C volunteered at Trinitas for over 20 years. Some of her fellow volunteers became her closest friends. She also used the Hospital dozens of times for her own health needs, some major, some minor. In fact, two of her children were born there. Each year she gave a small gift to the Foundation. She would have liked to give more, but needed to protect her income, just in case. So she also decided to include Trinitas in her will. Making a bequest gave her the opportunity to make the bigger gift she always wanted to. In addition, her bequest could endow her annual gift, making sure that the Foundation never had to lose the support she gave each year.

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Life Income Gifts
With life income gifts, not only do you make a wonderful gift to Trinitas, but you or a loved one also can get income from the gift until it matures.

As in the story below, life income gifts can provide great tax benefits. You get a charitable deduction now for the calculated value of the gift and you get income from the gift for life. If you fund the gift with appreciated property like stock, you also save capital gains tax when the trust sells the property, giving the trust even more assets to reinvest.

Example: Mr. G has some stock that has done beautifully - more than doubling in value since he bought it. The stock does not produce much income. Mr. G has considered selling the stock and reinvesting the money to boost his income, but after paying capital gains tax, he would not have as much to reinvest. Mr. G's advisor recommended that he consider a life income gift to a charity. Mr. G would give the stock to a charitable fund, like a trust or a pooled income fund. When the fund or trust sells the stock, it does not pay capital gains tax. The fund would then pay the income from the investment to Mr. G for the rest of his life. On Mr. G's death, the remaining value of the investment would go to the charity. Mr. G chose to put the stock into a charitable remainder trust. In addition to boosting his income, he got a current income tax deduction for the value of the gift to the Trinitas Health Foundation.

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Charitable Lead Trusts
If you are considering how to pass your estate to children and grandchildren without overwhelming estate taxes, consider a charitable lead trust. (This is the model Jackie O used.) The income from a charitable lead trust goes to a charity, and the remainder, at the end of the trust, goes to your children or grandchildren.

Example: When Mr. and Mrs. L sold their business to retire, they were lucky enough to get over $20 million. They were thrilled at the thought of leaving significant inheritances for their grandchildren. They were stunned when their attorney told them that taxes would claim almost three-quarters of that before the gift could reach their grandchildren. Their attorney knew that they had supported Trinitas for years and suggested a charitable lead trust. By transferring the money to a trust now and giving some to charity, the Ls could reduce the value that the government put on the transfer, also decreasing the bite that taxes would take before the funds reached their grandchildren. Trinitas would get a wonderful gift of income from the trust for years. In addition, the Ls were teaching their grandchildren by example the value of supporting the charitable organizations in the community.

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Retirement Plan Gifts
Retirement accounts (or any assets subject to income tax, like U.S. Savings Bonds) are great choices for charitable bequests because they can be so heavily taxed in an estate. The transfer must be carefully planned, so be sure to talk to us or to your professional advisor.

Congress is considering legislation that might make charitable giving from retirement accounts even easier; for example, it may allow retirement fund assets to roll directly into charitable trusts. Watch the news or talk to us to learn about any developments.

Example: Mrs. C, and her husband, before his death, carefully saved throughout their working years in their retirement accounts. Mrs. C also has other investments and a house. Luckily, the retirement accounts have grown large enough so that Mrs. C has more than enough to support her through retirement.
She plans to leave most of her estate to her children and make bequests to several charities she cares about, including Trinitas Health Foundation. Her advisor has told her that any assets left in the retirement accounts after her death will face both income and estate tax - her children may get little more than 20% after taxes. If she leaves the retirement accounts to charity, charitable deductions eliminate all the tax on the accounts.

Mrs. C has decided to change the successor beneficiaries of the retirement accounts to the Trinitas Health Foundation and other charities, leaving her other, less heavily taxed assets to her children.

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Insurance Gifts
Life insurance gifts can be new policies or existing policies, like Mr. K's. Those considering gifts of life insurance may either keep the right to change the beneficiary or give ownership of the policy to the charity. If you keep the right to change the beneficiary, you do not get a current charitable income tax deduction (your estate will still get a charitable deduction). Giving ownership of the policy will give you a current income tax deduction for approximately the cash value of the gift and will remove the value of the policy from your estate.

Many people who give ownership of a policy to a charity decide to continue paying the premiums. If they do, they get a charitable deduction each year they pay.

Example: Mr. K is a gentleman in his late 50's. He is divorced, with three grown children. Twenty-five years ago, Mr. K, the primary earner for his family, took out a life insurance policy to protect his young family. The policy no longer serves his needs. Mr. K decided to give the policy to the Trinitas Health Foundation. Mr. K has now made a generous gift that the Foundation will receive upon his death.

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Real Estate Gifts
Under the right circumstances, property can be a great gift for the Foundation and for you. For example, the Foundation's offices are located in property from a generous donor. The Foundation cannot accept all real estate gifts, so please talk with us and with your professional advisor if you are thinking about a gift of real estate.

Property can sometimes be used to fund life income gifts. Mr. and Mrs. M could choose to use their vacation home to fund a charitable remainder trust, drawing extra income from the trust once the property is sold. Giving property that has increased in value can also save you capital gains tax.

Example 1: Ms. T, who just turned 78, has lived in her house in Union for 30 years. Her two children have settled out of state. Ms. T would like to make a gift to the Trinitas Health Foundation. She considered a cash bequest in her will, but wondered whether she could leave the house instead, saving her children the trouble of selling it. After talking with her advisors and with the Foundation, she decided to make a current gift of the house and retain a life estate. The retained life estate means that for the rest of her life Ms. T will be able to live in and maintain the house. Because she is making the gift now, instead of in her will, she also gets a charitable deduction now on her income taxes for the value of the gift.

Example 2: Mr. and Mrs. M are retired and living in Elizabeth. They care about Trinitas, and would like to make a generous contribution. But they are also concerned about having enough income to last through retirement, and don't want to use up their retirement accounts or their savings and investments. Mr. and Mrs. M decided, instead, to give their vacation house to the Foundation.

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