Ways of Giving

Those who wish to make a gift to the school can do so using various sources of assets and income, as presented and illustrated here.The information shown here is not exhaustive – it is meant to stimulate further inquiry. It is strongly advised, however, that you consult your attorney or financial advisor before making a final gift decision.

 

Outright Gifts

Cash

  • Most common and simplest method for making a charitable contribution.
  • Fully tax deductible up to 50 percent of adjusted gross income (AGI), with a five-year carryover allowed for any excess deduction.
  • The higher the tax rate, the greater the savings.

Multi- Year Pledges

  • Payable over a three to five-year period.
  • Deductible in the year a payment is made.

Matching Gifts

  • Takes advantage of programs offered by many employers.
  • Leverages donor’s gift to a higher level.

Appreciated Securities

  • By giving publicly traded stocks held long term (more than one year) directly to the school, taxes on capital gains will be avoided.
  • Full fair market value of the stock gift is tax deductible up to 30 percent of adjusted gross income (AGI), with a five-year carryover allowed for any excess deduction.

Depreciated Securities

  • Donor sells property, takes loss for tax purposes, then contributes the cash received from the sale.
  • Donor receives a tax deduction for both the loss and the charitable gift.

Closely-Held Securities

  • Produces a current tax deduction equal to fair market value of the stock.
  • Corporation may redeem shares of the stock from the school.
  • Could reduce liability for accumulated earnings tax.

Real Property

  • Possible for donor to make gifts of residence, farm, or vacation home, reserving the right of occupancy as long as donor and spouse live.
  • Irrevocable gift qualifies for immediate tax deduction based on present value of remainder interest.
  • Assign directly to Saint Stephen’s Episcopal School or, preferably, transfer through broker.
  • Amount of contribution is fair market value on the date of transfer.

 

Deferred Gifts

Charitable Gift Annuity

  • Provides a fixed income for the lifetime(s) of one or two annuitants.
  • Amount paid determined by rates recommended by the American Council on Gift Annuities.
  • The older the annuitant, the higher the level of income.
  • Portion of gift and income are tax deductible.

Deferred Gift Annuity

  • Offers increased income and tax benefits.
  • All basic features and benefits of a gift annuity.
  • Income delayed until a future date chosen by the donor.
  • Rate of return and tax deduction dependent on length of income delay.

Life Income Trusts

  • Trust assets are funds or property contributed by donor (usually $100,000 or more).
  • Flexibility in type of property that can be donated.
  • Real estate and municipal bonds may be used.
  • Provides a fixed amount of income (Charitable Remainder Annuity Trust).
  • Provides a variable level of income (Charitable Remainder Unitrust).

Charitable Lead Trust

  • Donor provides assets for use for a limited period of time.
  • Funds are invested to provide income to Saint Stephen’s Episcopal School.
  • Assets returned to donor or to estate at end of designated period.
  • Can fulfill a pledge while reducing estate and gift taxes that might otherwise be due on assets given outright to heirs.

Life Insurance

  • Make Saint Stephen’s Episcopal School sole owner and beneficiary of paid-up policy.
  • Receive income tax deduction for the cash surrender value of policy.
  • If policy not fully paid, continue to pay premiums.
  • Receive tax deduction for annual premium amounts.

Bequests

  • Outright bequests, as well as certain bequests in trust, are not subject to estate taxes.
  • Actual cost is less than face value of gift because of tax benefits to estate.
  • Bequest can take any of the following forms:
    • Bequest of a dollar amount of particular securities or other property.
    • Residual bequest of all or portion of estate after payment of specific amounts to other beneficiaries.
    • Contingent bequest to take effect if other beneficiaries die before the donor.
  • A bequest can often be arranged simply with the addition of a codicil amending an existing will.


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