Current and Planned Giving
Methods of Giving
Current gifts, estate gifts, and partnership gifts provide financial support for commended workers under the Healthcare Assistance Program (HCAP) or other ministries of the Foundation, a tax benefit to the donor, and, depending on the method, an income benefit to the donor. “Click” on these gift category links to learn about the various ways you can make gifts to Stewards Foundation. Please email if you have any questions.
Current Gifts
Current gifts of cash or appreciated securities may be designated for the Healthcare Assistance Program or other need pre-approved by the Foundation Board, or left unrestricted (Unrestricted Funds). Unrestricted gifts may be used to support the loan or HCAP programs, or other priority needs as determined by the Foundation Staff under policy direction of the Foundation Board.
Cash Gifts
Cash gifts for the Lord’s work of Stewards Foundation are made by check to Stewards Foundation. Since the Foundation qualifies as an exempt not-for-profit association of churches charitable organization (Internal Revenue Regulation 1.170A-9 Definition of a Internal Revenue Code Section 170(b)(1)(a) Charitable Organization), you, as the donor, receive a tax deduction for the full value of the cash gift subject to charitable deduction limitations.
The annual charitable deduction to churches, associations of churches, educational and certain other organizations for cash-type deductions is limited to 50% of the donor’s adjusted gross income. However, the donor can apply any unused deductions for up to five more years giving the donor six full years to use the deduction, although "some portion of the deduction expires each year whether it is actually used or not" in accordance with IRS Reg. 1.170A-10(a)(2).
Appreciated Securities Held Long Term
Appreciated securities made as an irrevocable donation to Stewards Foundation also enable you, as the donor, to take a current income tax deduction. The tax deduction for long term appreciated property-type deductions is available up to 30% of adjusted gross income. Amounts in excess of the 30% limit may be carried forward for as many as five years, although "some portion of the deduction expires each year whether it is actually used or not" in accordance with IRS Reg. 1.170A-10(a)(2). In addition, if you contribute appreciated securities held longer than one year, you will also avoid paying capital-gains tax as long as the appreciated securities, and not the sales proceeds, are given to Stewards Foundation. Please click here for Instructions for Making a Securities Donation to Stewards Foundation.
Please note this only applies to appreciated securities, since securities that have declined in value should be sold, converted to cash, and the cash donation then made to Stewards Foundation to enable you to take the tax advantage for the loss.
Estate Gifts
An estate gift for the Lord’s work through Stewards Foundation defers funding of your gift until after your lifetime. Estate gift options listed below may be designated for the Healthcare Assistance Program or other need pre-approved by the Foundation Board, or left unrestricted (Unrestricted Funds). Unrestricted gifts may be used to support the loan or HCAP programs, or other priority needs as determined by the Foundation Staff under policy direction of the Foundation Board.
Bequests
A bequest from a Will or a Living Trust lets you pass along a specific amount, a percentage of your estate, or a percentage of the residual of your estate to Stewards Foundation. This gift may be free of federal estate tax. For an example of the language to use in your will or living trust, please click here.
Life Insurance
Making Stewards Foundation the owner of your Life Insurance Policy may give you, on the date of transfer of ownership, a chartiable income-tax deduction for the policy’s fair market value or cost basis (if lower). Alternatively, naming Stewards Foundation the beneficiary of your Life Insurance Policy, may give your estate a federal charitable estate tax deduction for the insurance proceeds.
Retirement Plan Assets
Gifts of IRA or qualified pension plan assets to Stewards Foundation through the designated benefciary of the IRA or qualified pension plan may not be subject to federal income or estate taxes in the donor's estate. Since retirement plan assets may be reduced by estate taxes and since heirs of plan assets must pay income taxes when assets are withdrawn, it may be beneficial to pass on less heavily taxed assets to your family and leave retirement plan assets to Stewards Foundation.
If you choose to name Stewards Foundation as a beneficiary in your will, living trust, life insurance policy, or retirement plan, please let us know of your plans so we can show appreciation of your generosity and include your gift in planning future support of the Lord’s work through Stewards Foundation.
Partnership Gifts
Partnership gifts of cash or appreciated securities allow you to provide for the Lord’s work through Stewards Foundation, provide for yourself, and in selected options, provide for your beneficiaries. Partnership gift options listed below may be designated for the Healthcare Assistance Program or other need pre-approved by the Foundation Board, or left unrestricted (Unrestricted Funds). Unrestricted gifts may be used to support the loan or HCAP programs, or other priority needs as determined by the Foundation Staff under policy direction of the Foundation Board.
Charitable Gift Annuity*
When a gift annuity is created, part of the value of the total assets transfered represent a charitable gift to Stewards Foundation and part is the amount exchanged for an annuity contract. The annuity is secured by the assests of the Foundation, including the annuity reserve fund. Gift annuities are typically funded with cash assets of $10,000 or more, although appreciated securities held long term are also appropriate. The Foundation reinvests your gift and contractually agrees to make a guaranteed annual fixed payment to you and up to one other annuitant (spouse, or other relative or friend for example) – for life. At the end of this agreement, the remaining assets are your gift to support the Lord’s work through Stewards Foundation.
The benefits include 1) a partial bypass of capital gain for appreciate assets since part is gifted to the Foundation with the rest returned as an annuity, 2) an annual fixed payment to you, part of which is tax free until life expectancy is reached, and 3) a charitable deduction for the current gift of a future interest in the year the gift is created. The amount of the charitable deduction, which must be at least 10% of the total assets transferred when the annuity is created, is a function of the date of the gift and the applicable federal discount rate used to determine the present value of the income interest.
Rates of return to determine the fixed payments of the annuity, which may be paid monthly, quarterly, semi-annually or annually, are a function of age and number of beneficiaries. Please click here to see a sample of rates of return.
If you would like to have a personal presentation and explanation of income and tax deductions for a Charitable Gift Annuity for your particular situation, please contact Tom Harrington by email or at (469) 438-3133. Alternatively, please click here and select the Charitable Gift Annuity Program Calculator to create your own gift illustration of income and tax deductions for you.
*Note: Arkansas, California, Hawaii, New Jersey, New York, North Dakota, Maryland, Washington and Wisconsin are Charitable Gift Annuity "permit" states. Permit states require non-profit charities to obtain a permit to issue gift annuities in that state. If you are a resident of one of these permit states, please contact Tom Harrington for information unique to your state.
Deferred Payment Gift Annuity*
Younger donors may contribute to a Deferred Payment Gift Annuity and choose to wait until retirement to receive income. The benefits are similar to the Charitable Gift Annuity and include, for the donor, a partial bypass of capital gain, a partial tax free income payment, and a charitable deduction for the current gift of a future interest; and for Stewards Foundation a gift to support the Lord’s work through its programs.
In preparing for retirement, one planning option with a series of deferred annuities is to fund one annuity contract over a period of years up to six. In this Retirement Annuity option, the donor would set up each contract to have the same payout date and schedule for the retirement years, with the remainder at the end of the contracts going to benefit the Lord's work through Stewards Foundation programs.
A Term of Years Retirement Annuity allows the donor to convert a one life or two lives Deferred Payment Gift Annuity to a term of years. An example of where this option might be appropriate is in "bridging" the gap between a retirement year and the year in which IRA withdrawals begin.
With a standard Deferred Payment Gift Annuity, the payout must be deferred for one or more years from the annuity agreement date, and the deferral date and payment amounts are fixed. An option to this standared annuity is the Flexible Deferred Payment Gift Annuity. The flexible annuity requires the donor to set a target date for the annuity start date, but allows the start of the annuity in an earlier or later year than the target year. If the flexible annuity is started earlier than the target date, the annuity payout will be reduced, and if the flexible annuity is started later than the target date, the annuity payout will be increased. In either case, the payout is adjusted to produce the same charitble income tax deduction as the target year.
If you would like to have a personal presentation and explanation of income and tax deductions for a Deferred Payment Gift Annuity for your particular situation, please email us. Alternatively, please click here and select the Deferred Gift Annuity Program Calculator to create your own gift illustration of income and tax deductions for you.
Charitable Remainder Trust
The Charitable Remainder Trust offers the dual benefits of a gift to support the Lord’s work through Stewards Foundation, and an investment plan for you and/or your beneficiaries. You place your appreciated securities or cash assets in an irrevocable Charitable Remainder Trust. The trust invests the cash assets or reinvests the proceeds from its sale of the appreciated securities assets in its diversified portfolio of stocks and bonds. Trusts are generally written for amounts greater than $200,000, and work best for low yielding, appreciated assets such as securities. Note: as a general guideline, donors should not transfer more than one-third to one-half of their estate into irrevocable trusts or any other permanent arrangement in order to preserve liquity for their future needs, and should consult a tax advisor about their particular financial planning situation.
From the trust’s investments, you and/or your beneficiaries receive income for the time period of the trust that is selected by you. This time period can be for one, two or for several lives; or for one or two lives plus a term of up to 20 years; or for a specified number of years up to 20.
At the termination of the trust, Stewards Foundation receives the remainder to be used as you specify.
The benefits of a Charitable Remainder Trust include 1) a bypass of capital gain for appreciated assets since the tax-exempt charitable trust (Stewards Foundation) sells the asset, 2) income for life or other term period selected, and 3) a charitable deduction for the current gift of a future interest in the year the trust is set up. The amount of the charitable deduction, which must be at least 10% of the total assets transferred when the trust is created, is a function of the date of the gift and the applicable federal discount rate used to determine the present value of the income interest.
Rates of return are a function of the type of charitable remainder trust:
Charitable Remainder Unitrust (CRUT)
The donor (and/or beneficiaries) receives a fixed percentage payout of at least 5% each year, based on the value of the assets in the unitrust that are revalued annually. Because the unitrust usually earns more than it pays out and because the assets are revalued each year, the income payments to the donor and/or beneficiaries increase each year as an inflation protection.
It should be noted that as long as the CRUT earns more than the payout percent, the capital gain bypass benefit mentioned above is permanent. Otherwise, part of the pre-gift capital gain is generally paid out to the recipient(s) and that part of the payout would be taxed at the captial gain rate.
Charitable Remainder Annuity Trust (CRAT)
The donor (and/or beneficiaries) receives a fixed dollar payout based on the value of the assets when the trust was created. This type of remainder trust is often selected by older donors in their 70’s or 80’s who prefer a fixed rather than a percentage payout.
The charitable deduction is generally higher for an annuity trust compared to a unitrust because any growth in the trust is passed on to the Stewards Foundation.
Since it is possible to exhaust the trust principle by paying a fixed amount regardless of trust earnings, the fixed payment is based on a rate of return when the trust is established that ensures a high probability (95%) that the trust principal will not be exhausted.
As with the unitrust, as long as the CRAT earns more than the payout, the capital gain bypass benefit mentioned above is permanent. Otherwise, part of the pre-gift capital gain is generally paid out to the recipient(s) and that part of the payout would be taxed at the captial gain rate.
If you would like to have a personal presentation and explanation of income and tax deductions for a Charitable Remainder Unitrust or Anuity Trust for your particular situation, please contact us. Alternatively, please click here and select the Remainder Unitrust, Remainder Unitrust for Term of 1-20 Years, Remainder Annuity Trust, or Remainder Annuity Trust for Term of 1-20 Years Program Calculators to create your own gift illustration of income and tax deductions for you.
Family Lead Trust
The Lead Trust provides income to Stewards Foundation for the donor’s life or a term of years, and then returns the assets to the family of the donor. This form of partnership gift may be appropriate for donors with large estates that would like to pass as much to their family as possible through minimizing gift or estate taxes and when the donor does not require a current annual income. There is no income tax deduction with a Family Lead Trust.
This trust may be set up as a unitrust, where a percentage amount is paid each year to Stewards Foundation, or as an annuity trust, where a fixed dollar amount is paid to Stewards Foundation.
If you would like to have a personal presentation and explanation of the Lead Unitrust or Lead Annuity Trust for your particular situation, please contact us by email . Alternatively, please click here and select the Lead Unitrust for Term of 1-35 Years or Lead Annuity Trust for Term of 1-35 Years Program Calculators to create your own gift illustration of these options.
This information is from the “Crescendo GiftLaw ProTax Manual,” and is for educational purposes and not professional tax or legal advice. Consult a Tax Advisor about your particular situation.