Invest in Lives. Invest in Futures. Invest in Hope.
Whether you're a new donor or lifetime supporter, you’ve seen firsthand the difference one person can make. What many people don't see, however, is the difference one person can make when they maximize their gifts to the men, women and children we serve through planned giving.
Financial planning in a way that honors your family and your legacy begins today. Our team at The City Mission can help you answer the many questions that come with making an investment or end of life gift, including:
- What can I really afford to give?
- How can I best maximize the dollars I do give?
- Can I do this in a way that provides some relief from taxes?
- Is there a way to improve my own financial situation and at the same time help The City Mission?
Our goal is to assist you in being a sound steward of what God has entrusted to you, by ensuring your estate is left in the hands of those doing God’s work. While that certainly might include family members, naming The City Mission or The City Mission Endowment Foundation in your Last Will and Testament will be a blessing to many families and individuals for years to come. When you're ready to talk through your long-term goals for your estate, we hope you'll contact our Major Gift Officer, Michael Parry.
Ways to Structure Planned Giving to The City Mission
One of the easiest ways to provide a lasting gift to The City Mission is with Life Insurance. If you have a life insurance policy that isn’t really needed anymore, it's possible to transfer ownership of the policy to The City Mission. This provides an immediate tax deduction equal to the lesser of the premiums paid, or the current value of the policy. Or, you could maintain ownership and simply make the Mission the beneficiary.
If you don’t have a life insurance policy but wish to purchase one, we can help you maximize your gift to our guests by creating a larger estate at a low cost over time. Your life insurance payments are also tax deductible if you make The City Mission the owner.
A Charitable Annuity is a way to make a future gift to The City Mission, while at the same time receiving a guaranteed income for life. Charitable Annuities provide:
- A guaranteed income that, depending on your age, is typically a larger payment than CDs and other guaranteed fixed investments
- Immediate tax deduction
- Ways to minimize capital gains over time, when funded with appreciated assets
- A method to minimize estate taxes
- Diversity in invested assets
Charitable Lead Trust
Planned giving to a charitable lead trust to The City Mission is most beneficial to individuals who may be subject to a large estate tax. The donor establishes and funds an irrevocable trust, and The City Mission receives payments from the trust, for a set number of years. At the end of the term, the trust assets are returned to the donor or passed on to heirs.
Payments to the City Mission can be a fixed dollar amount or a fixed percentage of the fair market value of the trust. The length of payments to The City Mission could be designed to achieve a near 100% charitable gift tax deduction when the trust is established.
IRA Distributions and Other Retirement Plans
Under current law, at just over age 70 individuals must begin to take the minimum distributions from their retirement plans. For some individuals, this money isn’t really needed and required distribution might even increase taxable income into the next higher tax bracket, creating more problems than assistance.
Instead of donating money directly from one's current income at minimum distribution age, you can donate the required IRA minimum distribution directly to The City Mission. This eliminates any taxation on the IRA withdrawal—money that has never been taxed. As financial situations change, donation portions to The City Mission can be reduced as needed.
Inherited retirement assets can also create estate tax problems for heirs. IRAs, 401K, 403B and other retirement accounts grow tax-deferred, often becoming quite large over the years. It's not unusual for children to lose a substantial portion of their parent’s retirement assets because of estate taxes.
Through proper planning estate taxes can usually be minimized and sometimes even eliminated. Any charitable beneficiary arrangement on all or a portion of your retirement accounts creates an estate tax deduction, therefore minimizing overall estate taxes.
For most people, estate taxes aren’t a large concern, but income taxes payable on the withdrawal of retirement assets can create problems for children and other beneficiaries on retirement benefits received by them. By designating The City Mission as beneficiary of retirement benefits, you can help to eliminate or minimize these taxes while bettering the lives of the hurting in your city.
The donation of appreciated stock is another easy planned giving method with a tax benefit. Appreciated stock may cause a sizable capital gains tax, often large enough to discourage the owner from selling the stock. This stock can be donated to The City Mission and provides tax savings instead of a tax problem. The full value of the stock can be deducted, subject to certain deduction limitations, without you having to pay any capital gains tax
Considering Your Options
Considering planned giving of any sort can seem overwhelming, but The City Mission stands ready to help you become a smart steward of your assets to the transformation of Cleveland and the people who call it home. Talk over your interests with your financial advisor, and get in touch with our Development Team to begin the process of planned giving.
Major Gift Officer
Phone 216-431-3510 ext. 269