By SEAN HAWKINS, CAWA, CHARLESTON ANIMAL SOCIETY CHIEF ADVANCEMENT OFFICER
YOUR STORY IS THE GREATEST LEGACY that you will leave to your family, friends and community. When you leave a financial gift to Charleston Animal Society in your will, trust, or through another form of planned gift, you can create a lasting legacy that reflects your caring and compassion for animals.
In this current time of uncertainty, many people are creating or updating their wills or estate plans. We wanted to provide some basic information about including a gift in your plans to make a lasting difference in our work to save the lives of innocent animals.
BEQUEST
A bequest to the Charleston Animal Society is a wonderful way to express your love for animals as part of your legacy. You can include a bequest to Charleston Animal Society in your will or trust. You can leave the gift to support the organization’s programs generally or you can designate your gift to a particular program area such as the prevention of cruelty to animals or the veterinary care of homeless animals.
Leaving a bequest is rather simple. Indicate a specific amount or a percentage of the balance remaining in your estate or trust documents. Below is example language that you can insert into your will:
“I bequeath _________(dollar amount or % of state) to be used for its general purposes (or you may restrict the gift to a specific program) to the Charleston Animal Society, Inc., or its successors and/or assigns by merger or purchase, federal tax identification number 57-6021863, whose permanent address is 2455 Remount Road, North Charleston, SC 29406.”
The benefit of designating a gift in your will is that your assets remain in your control during your lifetime. You can modify your bequest to address changing circumstances. Under current tax law there is no upper limit on the estate tax deduction for your charitable bequests.
LIFE INSURANCE
Charleston Animal Society accepts gifts of life insurance either as the beneficiary of a policy or as the sole owner and sole beneficiary. This can be an existing or employer-provided policy or a paid-up policy. You can name Charleston Animal Society as a primary life insurance beneficiary or as a contingent beneficiary should your other beneficiaries not survive you. After your lifetime, the benefits from your policy pass to the Animal Society, free of federal estate tax.
RETIREMENT PLANS
Retirement assets include tax-deferred retirement saving accounts, like Individual Retirement Accounts (IRA), 401(k), 403(b), annuities, Keogh, and pension plans. Gifts from these accounts while you are still living may have withdrawal penalties and may have income tax consequences. However, naming Charleston Animal Society as the beneficiary of your retirement assets at your death avoids both income tax and estate tax obligations.
If the largest asset in your estate is your retirement plan, such as a 401(k), IRA, or Keogh, you may be surprised to learn that the IRS will impose income tax on the remaining balance in the account if you designate it to a beneficiary other than your spouse.
The income from the after-death distribution of a tax-deferred retirement plan to an heir is taxable as income and is in addition to the estate tax that may be imposed on the account. For estates fully subject to the estate tax, the result can be that up to 75 percent of the value of your retirement plan will be consumed in taxes before your child, relative or friend receives it.
You can name Charleston Animal Society as a beneficiary of all or a portion of your IRA, 401(k) or other qualified plan. The balance in your plan reverts to Charleston Animal Society after your lifetime. Your gift to Charleston Animal Society is not taxed for income nor for the estate because the Animal Society is a tax-exempt organization.
When you designate a charity as the beneficiary of your IRA, you avoid the double taxation your retirement savings would incur if you designated your heir(s) as beneficiary(ies). You can continue to take regular lifetime withdrawals and you can remove the charity as a beneficiary if your family’s needs change.
STOCKS, BONDS, AND MUTUAL FUNDS
These are the most common types of securities in a person’s portfolio. By making a gift of securities to the Charleston Animal Society, you can claim the fully-appreciated value of the securities as a charitable contribution deduction and avoid the capital gains tax. Charleston Animal Society works with Charles Schwab for brokerage services. Contact us for the account information.
Even though Charleston Animal Society cannot provide you with specific financial planning or legal advice for your estate plans, we can provide you with basic information on the opportunities that are available to you. For more information and other ways to set up planned giving options, please contact our Chief Advancement Officer, Sean Hawkins, CAWA, at shawkins@charlestonanimalsociety.org.