Charitable Gift Planning
Charitable gift planning can be as simple as making a bequest in your will or revocable living trust to one or more Covenant ministries. But there are other possibilities. Charitable life income agreements allow you to achieve several personal financial goals at the same time, including making a contribution to the Lord’s work. When should you consider planned giving strategies which may include some type of life income agreement?
- If you have a charitable dream – a desire to give
- If you own highly appreciated assets – worth significantly more now than when you bought them, thus subject to capital gains taxes
- If you would like to reduce the amount of income tax you pay
- If you need additional income
- If you want or need to diversify your asset holdings
- If you have a child or other dependent who needs additional income
How do Charitable Life Income Agreements Work?
- You place cash or appreciated assets into a life income agreement
- You may receive payouts for life (or the lives of you and another person). You receive a charitable income tax deduction
- You reduce tax on capital gains
- One or more charitable ministries of your choice receives the remainder after death
Charitable life income agreements are often called “win-win” gifts because both parties win. The donor wins because of the tax benefits and potential increase in spendable income; the charity wins because the donor is enabled to make a legacy (deferred) gift which might have been otherwise impossible.
Covenant Trust Company offers a full portfolio of charitable life income agreements including charitable gift annuities; charitable remainder unitrusts; charitable remainder annuity trusts; pooled income funds; charitable lead trusts; and charitable life estates.