Planned giving benefits both the donor and the ICRF by enabling people to make a charitable gift, maintain a secure lifetime income, and derive substantial tax savings, while assuring that the money needed to support the vital work of the ICRF will be available far into the future.
What is a "Planned Gift"?
In most cases, it is a contribution made by a donor whereby he or she retains a lifetime income from the asset being donated, and the organization retains the asset at the end of the income stream. It can be set up to provide an income for life or for a fixed number of years. It is particularly suited to people of retirement age who are looking for a guaranteed income for those 'golden years.' Younger people can also establish a financially beneficial Planned Gift if it is properly structured.
What are the Advantages of Planned Giving to the Donor?
- Guaranteed Income: Contributors no longer have to worry whether or not their stocks will give them a dividend or what each month's CD rates are. Their Planned Gift income will keep coming, giving them a sense of security that is especially comforting for those living on a fixed income.
- Charitable Deductions on Personal Income Tax: Donors are entitled to receive a charitable deduction on their personal income tax return for a portion of the principal used to establish the Planned Gift.
- Capital Gains Tax Relief: If the contribution is funded with appreciated assets (for example, stocks, real estate, and/or artwork), the donor avoids paying capital gains tax up front, thereby making the entire current market value of the principal available for investing. This gives donors a much higher return than they would get by liquidating the asset on their own and then having to pay the capital gains tax. That would leave only 80%, or less, of the principal available for investments.
- High Rate of Interest: Donors receive a high rate of interest as compared to regular investments. Add in the charitable deduction, which reduces the costs of the gift, and the donor's yield grows even higher. Since part of the income may be tax-free, the yields can get even greater.
- Reduced Estate Taxes: In many cases, the deferred gift will help reduce possible estate taxes, leaving more for the beneficiaries of the estate.
Who Reaps the Benefits?
The ICRF Planned-Giving Program offers an opportunity to 'invest' in the Israel Cancer Research Fund's support of Israel's scientists working to vanquish cancer. The ICRF, the donor, and future generations will all reap benefits.
Your Gift by Bequest
In bequeathing cash or property to the Israel Cancer Research Fund, you may be able to make a large gift that is not possible during your lifetime. For tax purposes, your estate is reduced by the full value of your gift. Bequests give you a great deal of flexibility in providing both for your loved ones and ICRF. For example, you can stipulate that ICRF will receive:
- a specific amount of money, named securities, or other property; or
- a percentage of your estate; or
- whatever is left after all other bequests and estate expenses have been paid; or
- whatever your beneficiary would have received if he or she dies before you.
By means of your bequest, you can also create a trust that will pay income to a loved one for his or her lifetime. When that person dies, the principal will become the property of the ICRF. Such a vehicle can have important tax advantages for your estate. In certain cases, it can eliminate estate taxes entirely.
Your Gift by Life Insurance
Life insurance is an excellent way for you to make a large gift to the Israel Cancer Research Fund at a cost much smaller than the gift itself - and to enjoy significant tax advantages. You can do this in several ways:
- take out a life insurance policy naming ICRF as owner and beneficiary. The contributions you make to ICRF to pay the yearly premiums are tax deductible in the years they are made;
- donate an existing policy that you no longer need (for example, the children whom it was designed to protect are now adults), naming ICRF as owner and beneficiary. At the time of the gift, you can take as a tax deduction the policy's approximate cash surrender value or the net premiums paid, whichever is less. You can also deduct, in the years they are made, your contributions to ICRF to pay the remaining premiums. When you die, the proceeds become the property of ICRF, thereby falling outside your taxable estate:
- take out a policy naming ICRF as secondary beneficiary. If your primary beneficiary dies before you, the proceeds pass to ICRF tax free to your estate;
- name ICRF as beneficiary of a policy that you own. Since you retain ownership and have access to the cash value, you receive no tax deduction for the value of the policy or its subsequent premium payments; but, upon your death, the policy's proceeds are not taxable to your estate.
It is highly recommended that donors consult with their own tax or legal advisors prior to making a planned gift
Please call the ICRF International Executive Office at
(212) 969-9800 or your local ICRF Chapter for further information.
