Habitat for Humanity of Utah County: Planned Giving

Bequests

Have you made provisions in your will to benefit us? Bequests are the most popular type of planned gifts. Anything you leave to Habitat for Humanity of Utah County will reduce the size of your taxable estate while helping a good cause. You can leave to us a specific bequest of a specified sum of money or a particular piece of property. Other options are to leave a percentage of your estate or a percentage of the residue to us after making provisions for family and friends. For instance, you could leave us a specific bequest of $10,000, or you could leave us 10 percent of the residue of your estate.

Life insurance

Do you have life insurance policies that are no longer needed? You may either donate the life insurance policy to us, or simply name us as the beneficiary.

Securities

Stocks and publicly traded securities are easy to give and offer great tax advantages. The best stocks to use for charitable giving are those that have increased greatly in value, particularly those producing a low yield. If you have held them for more than one year, you will pay no capital gains tax on this transaction, and you can deduct the full fair market value.

Bank accounts and CDs

Are you aware that you can name us as the "payable-on-death beneficiary" of your bank accounts or on certificates of deposit? You own the assets for your lifetime and have them available for your use. Upon your death, the assets pass directly to us without going through probate. Simply visit your bank and request the necessary forms to name a beneficiary on your accounts or CDs. You can change beneficiary designations at any time.

Retirement plan assets

Because our tax laws often subject retirement plan assets to the highest combined income and estate taxes, charitable donations of these assets may be the most efficient estate planning option. Many of the techniques discussed on this page can be used to create generous charitable gifts, usually at your death, from retirement plan assets that could otherwise be subject to tax rates of nearly 65 percent. At the same time, you can pass more tax-favored assets to your family. Because of the variety and complexity of retirement plans, you should consult an attorney or tax specialist for a strategy best suited to your situation.

Other Considerations

A gift of real estate offers you the opportunity to make a significant charitable contribution with a tax-friendly outcome. There are several ways to donate real estate depending on your situation.

Outright gift. An outright gift may be the simplest solution if you own property that is not mortgaged, has appreciated in value and that you no longer need or use, such as a second home or vacation property. You can deduct the fair market value of your gift and avoid all capital gains taxes. Plus, you no longer have to worry about the costs of continued ownership, and you have removed that asset from your taxable estate.
Retained life estate. Did you know that you can transfer the deed of your personal residence or farm to us now and keep the right to use the property for your lifetime and that of your spouse? You will receive a current charitable deduction in an amount that is based upon your and your spouse's life expectancy and the value of the property.
Bargain sale. A bargain sale can generate a gift that is less than the full fair market value of the property. In this scenario you agree to sell the property to a charitable organization at less than its fair market value. The difference between the sale price and the fair market value is your charitable deduction. While the tax rules relating to a bargain sale are somewhat complex, the net result is often more favorable than selling the property at fair market value and making a charitable contribution from the realized capital gain.

For more information, contact our office at (801)344-8527.

Copyright: The Stelter Company. The information in this publication is not intended as legal advice. For legal advice, please consult an attorney. Figures cited in examples are based on current rates at the time of printing and are subject to change. References to estate and income tax includefederal taxes only; individual state taxes may further impact results.