Issuu on Google+

SPRING 2009

A One-of-a-Kind Accounting Major

INSIGHTS

Charitable Gift Annuity Highlights Fixed, dependable income for life, covering one or two lives.

TAX DEDUCTION

Current income tax charitable deduction.

FLEXIBILITY

Payments can begin now or later.

ACCESSIBLE

Easy to set up, low minimum amount, no ongoing renewals or administration requirements.

A CHARITABLE PLANNING GUIDE FOR ISU ALUMNI AND FRIENDS

Gift Planning Staff: (L-R) Gregg Hinders, Administrative Coordinator Lynda M. Jacobson, Assistant Vice President of Development Paul Caspersen, CFP®, CMFC, Executive Director of Development giftplanning@foundation.iastate.edu 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 rates current at the time of printing and are subject to change. References to estate and income tax include federal taxes only; individual state taxes may further impact results.

OFFICE OF GIFT PLANNING 2505 UNIVERSITY BOULEVARD P. O. BOX 2230 AMES, IA 50010-2230

The Appeal of the Charitable Lead Trust

INCOME

PHONE: 515.294.5398 TOLL-FREE: 800.621.8515 www.withprideandpurpose.org giftplanning@foundation.iastate.edu

Lifetime Income through Charitable Gift Annuities

mented, including a scholarship or endowed faculty position. Giving through a bequest has important advantages for the donor. For example, donors maintain control of their assets during their lifetime, and an estate tax charitable deduction may be available. After considering her goals and opportunities, Fuller did not stop with setting up a scholarship. In celebration of a successful professional career as a certified public accountant in the San Francisco area, she wanted to give more back to her university, so Fuller “I feel fortunate with how my life has turned out and I owe a lot of that created a deferred endowed faculty position in Iowa State’s to the time I spent at Iowa State and College of Business in recognithe education I received.” tion of her valuable experiences on campus. – Donna Johnson Fuller “Like many Iowa State graduates, I’m from a working class family from small town Iowa,” she said. “I feel fortunate with how my life has turned out and I owe a lot of that to the time I spent at Iowa State and the education I received.” When she first arrived on campus, Fuller says she was shy and not very outgoing. But her experiences as the only female accounting major on campus changed that. “I had to fight for what I wanted while I was a student. That changed my whole personality,” she said. “If I wouldn’t have changed at Iowa State and moved to California I wouldn’t have had the life I have now.”

2 Lifetime income through gift annuities 4 The appeal of the charitable lead trust 5 The Donna Fuller Scholarship for women accounting majors

Gerdin Business Building

Donna Fuller

INSIDE THIS ISSUE ...

Visit us online at www.isugift.org 5

IN THIS ISSUE ...

The Donna Fuller Scholarship for Women Accounting Majors

Like many of her fellow Iowa State University alumni, Donna Johnson Fuller has elected to establish a scholarship on campus. She hopes to help current students in a way that was unavailable while she was a student. In Fuller’s case that assistance takes on a whole new meaning because she was one-of-a-kind during her stint as an undergraduate in the 1960s. “I was the only woman accounting major,” says Fuller (B.S., ’68, accounting). “It was a little rough at the beginning, but I had a natural aptitude for accounting and business. I guess the men considered me an oddball and weren’t real nice to me for a year or so. But it didn’t take long for them to realize I could help them instead.” During her undergraduate years, Fuller also worked the swing shift at a local electronics factory. While she says these experiences made her a better person, she has taken steps to smooth the path for those who follow her. More specifically, she has established a bequest to create the Donna Fuller Scholarship for women accounting majors. Individuals like Fuller who establish such a scholarship can do so through a bequest in their will naming the Iowa State

University Foundationas the beneficiary of the funds. This is the easiest and most popular deferred gift plan used by alumni and friends. There are many options available through bequests. Donors may name the Iowa State University Foundation as a percentage beneficiary, or as the recipient of a specific dollar amount or specific assets, or as a residual or contingent recipient. The assets can be used to support Iowa State for the purposes the donor has docu-

IOWA STATE UNIVERSITY FOUNDATION 2505 UNIVERSITY BOULEVARD P.O.B OX 2230 AMES, IA 50010-2230

Donna Fuller Creates a Scholarship for Future Generations

I O WA S TAT E U N I V E R S I T Y F O U N D AT I O N


Now Is an Ideal Time to Make a Difference Without a doubt, times are changing — and challenging. Everyone has been affected by the economy. Nonetheless, many Iowa State University supporters realize that charitable giving remains vitally important — especially now. In the current financial environment, planning strategies that create income, reposition assets, and provide lifetime income for you and your loved ones have become intriguing alternatives to estate and outright gifts. Consequently, the unique benefits found in charitable gift annuities have made them the 2009 gift of choice for many donors. Why? Because a charitable gift annuity is a carefully structured gift that provides you with an opportunity to benefit yourself, your loved ones and Iowa State. How can a charitable gift annuity be used to meet a wide variety of personal goals? The charitable gift annuity is easy to set up, and the rewards more than justify the effort. Take a moment to review the options

What Does It Mean to “Help Us While You Help Yourself?”

outlined below and consider whether the charitable gift annuity may be worth exploring further. If you’re interested in learning more, return the attached card or contact us by phone or e-mail to request our complimentary brochure, The Charitable Gift Annuity — Back to Basics. It would be our pleasure to help you and your advisor(s) as you consider your philanthropic options.

The charitable gift annuity is a form of charitable gift that provides a lifetime income to the annuitant (usually the donor) and a gift to the charity. The primary purpose of the charitable gift annuity is to support a worthwhile charity, but the lifetime income makes this way of giving attractive to all sorts of donors. Here are a few examples of how a charitable gift annuity helps not only you, but also Iowa State University. Note: All illustrations based on AFR of 3.0% and an annual payment.

Lynda M. Jacobson Assistant Vice President of Development Office of Gift Planning ljacobson@foundation.iastate.edu 515.294.4049 ❙ 800.621.8515

Predictable Retirement Income for Today All her life, Rose (age 80) has been careful to save for a rainy day. And her decision to be a saver has served her well. Earlier this year, Rose worked with a financial advisor to review her financial program. Rose decided to take the money from a maturing CD ($10,000) and direct it toward a charitable gift annuity. The gift annuity will pay her $710 every year as long as she lives, plus, for the next 10 years, about $551 of each payment will be tax-free. And this year, Rose receives a charitable tax deduction of $5,041 that can lower her taxes if she itemizes. Rose considers the charitable gift annuity a great thing — a reliable source of income for her and a substantial charitable gift to us.

The Charitable Gift Annuity: Greater than the Sum of Its Parts Usually, when someone gives something to someone else, the idea is that one person has less and another person has more. But, the charitable gift annuity is different. The donor does not just give; she or he also receives something back. Many donors find the charitable gift annuity a smart way to give and receive for different reasons, including: ■ ■

■ ■

You can have more than one charitable gift annuity. There is generally no maximum contribution limit as there is with a qualified retirement plan. The minimum gift amount is low. Charitable gift annuities are easy to set up and do not need annual maintenance or renewal. Gift annuity payments are for life — you can’t outlive the payment period.

If you’re interested in more information about the charitable gift annuity and how you might help yourself while helping us, send for our complimentary brochure, The Charitable Gift Annuity — Back to Basics. Or, feel free to call or e-mail us directly. It would be our pleasure to help you determine whether a charitable gift annuity is a good match for your philanthropic goals.

Charitable Gift Annuity Payment Rates Age 65 70 75 80 85 90

Rate* 5.3% 5.7 6.3 7.1 8.1 9.5

*Rates as of Feb. 1, 2009. Please contact our office to verify current rates.

Income for Two Harold and Louise (both age 75) have always been careful planners. After celebrating their 50th wedding anniversary, they took a close look at their estate plan to see how they might best manage their resources for the future. Their goals included providing for themselves, their heirs and their favorite charity. One option that came to light was the charitable gift annuity. It seemed to be a great gift idea, since it made it possible to provide a significant gift and receive a fixed, dependable lifetime income. They funded a two-life charitable gift annuity with three different stocks worth a total of $50,000. Every year, the gift annuity will pay out $2,800 as long as Harold or Louise lives. Plus, they received a charitable tax deduction of $17,876 this year. Harold and Louise both enjoy peace of mind from knowing the income is payable for as long as

Find a planning option that benefits you and Iowa State We hope you have found useful ideas in this issue of Insights. To further aid your planning, send for a complimentary copy of the booklets listed below, with no obligation. Simply fill out this tear-off card, fold, tape it on the open end, and drop it in the mail to us. We’ll pick up the postage.

Predictable Income for Later

either of them is alive, and the arrangement is a one-time affair. There is never a need for renewals or additional paperwork.

Income for a Loved One With years of hard work and perseverance, Greta built up her consultancy business. Today, her company employs 20 wonderful people and generates plenty of work. Plus, Greta is ready to retire through an employee buyout, so in a month she will receive a large sum of money. Greta is a great supporter of charity, and she plans to make a major contribution that will create an endowed fund. However, Greta also plans to create a charitable gift annuity based on a gift of $75,000 that will provide help to her mother, Eleanor (age 85), who still lives across town in the small house where Greta grew up. The charitable gift annuity will provide a fixed annual income of $6,075 for Eleanor, which is good because Greta usually sends money each month. And, the charitable gift annuity generates an income tax charitable deduction of $42,392, which also works well for Greta because this will be an unusually high-income year for her due to the sale of her business. Greta is pleased that a charitable gift annuity nicely complements her personal, philanthropic and financial goals.

Dr. Martin knows he will reach the maximum contribution limit for his qualified retirement plan, so he is looking for additional ways to help prepare for retirement. At age 60, he wants to take advantage of opportunities available during his prime income-earning years. One option that interests Dr. Martin is a deferred charitable gift annuity. The deferred charitable gift annuity works just like a regular charitable gift annuity except that the first payment to the annuitant begins a year or more after the gift is made to the charitable organization. And Dr. Martin can choose the date the payments begin. The difference between a deferred charitable gift annuity and a regular gift annuity is the higher payout rate and the higher income tax deduction. Dr. Martin decides to make a gift of $50,000 today and arranges the payments to begin in exactly ten years, allowing him to deduct $20,611 this year. And, in 10 years, Dr. Martin will begin receiving $4,050 once a year for the rest of his life.

Consider Your Options If you are interested in learning more about the charitable gift annuity, please let us know. We are happy to help you explore options for using the gift annuity to meet philanthropic and personal goals.

Please send a complimentary copy of: The Charitable Gift Annuity — Back to Basics, a brochure detailing how gift annuities work, and the benefits for a donor. Personal Financial Affairs: Your Book of Records, a helpful planning guide for documenting important information. I’m interested in a no-cost, no obligation illustration of the benefits of a charitable gift annuity. I’m interested in discussing the various ways to support Iowa State. Please contact me ____ by phone ____ by e-mail to talk about these possibilities.

A Step Further: Now May Be the Time to Consider a Charitable Lead Trust

Please sign me up for your free e-newsletter. E-mail address below.

Many philanthropists face a dilemma. How can they help the organizations they care about without short-changing heirs and loved ones? One potential solution is the charitable lead trust. A charitable lead trust is set up so annual payments are made to a qualified charity such as Iowa State University. When the trust ends, assets can go to the trust beneficiaries — usually family members. A charitable lead trust can be particularly appealing during these economic times for two reasons: (1) in a time of low rates, the grantor pays significantly less in gift or estate taxes for the remainder interest in a charitable lead trust that goes to family and loved ones; and (2) if assets used to fund the trust grow during the trust term, the appreciation is NOT taxed for gift or estate tax purposes.

NAME

ADDRESS

CITY

STATE, ZIP

According to a recent Wall Street Journal article, charitable lead trusts are “especially attractive now” given the low rates. Please contact us if you’re interested in receiving additional information.

TELEPHONE

E-MAIL

INGA0509

Iowa State University Foundation INSIGHTS

2

3

Visit us online at www.isugift.org

4


Now Is an Ideal Time to Make a Difference Without a doubt, times are changing — and challenging. Everyone has been affected by the economy. Nonetheless, many Iowa State University supporters realize that charitable giving remains vitally important — especially now. In the current financial environment, planning strategies that create income, reposition assets, and provide lifetime income for you and your loved ones have become intriguing alternatives to estate and outright gifts. Consequently, the unique benefits found in charitable gift annuities have made them the 2009 gift of choice for many donors. Why? Because a charitable gift annuity is a carefully structured gift that provides you with an opportunity to benefit yourself, your loved ones and Iowa State. How can a charitable gift annuity be used to meet a wide variety of personal goals? The charitable gift annuity is easy to set up, and the rewards more than justify the effort. Take a moment to review the options

What Does It Mean to “Help Us While You Help Yourself?”

outlined below and consider whether the charitable gift annuity may be worth exploring further. If you’re interested in learning more, return the attached card or contact us by phone or e-mail to request our complimentary brochure, The Charitable Gift Annuity — Back to Basics. It would be our pleasure to help you and your advisor(s) as you consider your philanthropic options.

The charitable gift annuity is a form of charitable gift that provides a lifetime income to the annuitant (usually the donor) and a gift to the charity. The primary purpose of the charitable gift annuity is to support a worthwhile charity, but the lifetime income makes this way of giving attractive to all sorts of donors. Here are a few examples of how a charitable gift annuity helps not only you, but also Iowa State University. Note: All illustrations based on AFR of 3.0% and an annual payment.

Lynda M. Jacobson Assistant Vice President of Development Office of Gift Planning ljacobson@foundation.iastate.edu 515.294.4049 ❙ 800.621.8515

Predictable Retirement Income for Today All her life, Rose (age 80) has been careful to save for a rainy day. And her decision to be a saver has served her well. Earlier this year, Rose worked with a financial advisor to review her financial program. Rose decided to take the money from a maturing CD ($10,000) and direct it toward a charitable gift annuity. The gift annuity will pay her $710 every year as long as she lives, plus, for the next 10 years, about $551 of each payment will be tax-free. And this year, Rose receives a charitable tax deduction of $5,041 that can lower her taxes if she itemizes. Rose considers the charitable gift annuity a great thing — a reliable source of income for her and a substantial charitable gift to us.

The Charitable Gift Annuity: Greater than the Sum of Its Parts Usually, when someone gives something to someone else, the idea is that one person has less and another person has more. But, the charitable gift annuity is different. The donor does not just give; she or he also receives something back. Many donors find the charitable gift annuity a smart way to give and receive for different reasons, including: ■ ■

■ ■

You can have more than one charitable gift annuity. There is generally no maximum contribution limit as there is with a qualified retirement plan. The minimum gift amount is low. Charitable gift annuities are easy to set up and do not need annual maintenance or renewal. Gift annuity payments are for life — you can’t outlive the payment period.

If you’re interested in more information about the charitable gift annuity and how you might help yourself while helping us, send for our complimentary brochure, The Charitable Gift Annuity — Back to Basics. Or, feel free to call or e-mail us directly. It would be our pleasure to help you determine whether a charitable gift annuity is a good match for your philanthropic goals.

Charitable Gift Annuity Payment Rates Age 65 70 75 80 85 90

Rate* 5.3% 5.7 6.3 7.1 8.1 9.5

*Rates as of Feb. 1, 2009. Please contact our office to verify current rates.

Income for Two Harold and Louise (both age 75) have always been careful planners. After celebrating their 50th wedding anniversary, they took a close look at their estate plan to see how they might best manage their resources for the future. Their goals included providing for themselves, their heirs and their favorite charity. One option that came to light was the charitable gift annuity. It seemed to be a great gift idea, since it made it possible to provide a significant gift and receive a fixed, dependable lifetime income. They funded a two-life charitable gift annuity with three different stocks worth a total of $50,000. Every year, the gift annuity will pay out $2,800 as long as Harold or Louise lives. Plus, they received a charitable tax deduction of $17,876 this year. Harold and Louise both enjoy peace of mind from knowing the income is payable for as long as

Find a planning option that benefits you and Iowa State We hope you have found useful ideas in this issue of Insights. To further aid your planning, send for a complimentary copy of the booklets listed below, with no obligation. Simply fill out this tear-off card, fold, tape it on the open end, and drop it in the mail to us. We’ll pick up the postage.

Predictable Income for Later

either of them is alive, and the arrangement is a one-time affair. There is never a need for renewals or additional paperwork.

Income for a Loved One With years of hard work and perseverance, Greta built up her consultancy business. Today, her company employs 20 wonderful people and generates plenty of work. Plus, Greta is ready to retire through an employee buyout, so in a month she will receive a large sum of money. Greta is a great supporter of charity, and she plans to make a major contribution that will create an endowed fund. However, Greta also plans to create a charitable gift annuity based on a gift of $75,000 that will provide help to her mother, Eleanor (age 85), who still lives across town in the small house where Greta grew up. The charitable gift annuity will provide a fixed annual income of $6,075 for Eleanor, which is good because Greta usually sends money each month. And, the charitable gift annuity generates an income tax charitable deduction of $42,392, which also works well for Greta because this will be an unusually high-income year for her due to the sale of her business. Greta is pleased that a charitable gift annuity nicely complements her personal, philanthropic and financial goals.

Dr. Martin knows he will reach the maximum contribution limit for his qualified retirement plan, so he is looking for additional ways to help prepare for retirement. At age 60, he wants to take advantage of opportunities available during his prime income-earning years. One option that interests Dr. Martin is a deferred charitable gift annuity. The deferred charitable gift annuity works just like a regular charitable gift annuity except that the first payment to the annuitant begins a year or more after the gift is made to the charitable organization. And Dr. Martin can choose the date the payments begin. The difference between a deferred charitable gift annuity and a regular gift annuity is the higher payout rate and the higher income tax deduction. Dr. Martin decides to make a gift of $50,000 today and arranges the payments to begin in exactly ten years, allowing him to deduct $20,611 this year. And, in 10 years, Dr. Martin will begin receiving $4,050 once a year for the rest of his life.

Consider Your Options If you are interested in learning more about the charitable gift annuity, please let us know. We are happy to help you explore options for using the gift annuity to meet philanthropic and personal goals.

Please send a complimentary copy of: The Charitable Gift Annuity — Back to Basics, a brochure detailing how gift annuities work, and the benefits for a donor. Personal Financial Affairs: Your Book of Records, a helpful planning guide for documenting important information. I’m interested in a no-cost, no obligation illustration of the benefits of a charitable gift annuity. I’m interested in discussing the various ways to support Iowa State. Please contact me ____ by phone ____ by e-mail to talk about these possibilities.

A Step Further: Now May Be the Time to Consider a Charitable Lead Trust

Please sign me up for your free e-newsletter. E-mail address below.

Many philanthropists face a dilemma. How can they help the organizations they care about without short-changing heirs and loved ones? One potential solution is the charitable lead trust. A charitable lead trust is set up so annual payments are made to a qualified charity such as Iowa State University. When the trust ends, assets can go to the trust beneficiaries — usually family members. A charitable lead trust can be particularly appealing during these economic times for two reasons: (1) in a time of low rates, the grantor pays significantly less in gift or estate taxes for the remainder interest in a charitable lead trust that goes to family and loved ones; and (2) if assets used to fund the trust grow during the trust term, the appreciation is NOT taxed for gift or estate tax purposes.

NAME

ADDRESS

CITY

STATE, ZIP

According to a recent Wall Street Journal article, charitable lead trusts are “especially attractive now” given the low rates. Please contact us if you’re interested in receiving additional information.

TELEPHONE

E-MAIL

INGA0509

Iowa State University Foundation INSIGHTS

2

3

Visit us online at www.isugift.org

4


Now Is an Ideal Time to Make a Difference Without a doubt, times are changing — and challenging. Everyone has been affected by the economy. Nonetheless, many Iowa State University supporters realize that charitable giving remains vitally important — especially now. In the current financial environment, planning strategies that create income, reposition assets, and provide lifetime income for you and your loved ones have become intriguing alternatives to estate and outright gifts. Consequently, the unique benefits found in charitable gift annuities have made them the 2009 gift of choice for many donors. Why? Because a charitable gift annuity is a carefully structured gift that provides you with an opportunity to benefit yourself, your loved ones and Iowa State. How can a charitable gift annuity be used to meet a wide variety of personal goals? The charitable gift annuity is easy to set up, and the rewards more than justify the effort. Take a moment to review the options

What Does It Mean to “Help Us While You Help Yourself?”

outlined below and consider whether the charitable gift annuity may be worth exploring further. If you’re interested in learning more, return the attached card or contact us by phone or e-mail to request our complimentary brochure, The Charitable Gift Annuity — Back to Basics. It would be our pleasure to help you and your advisor(s) as you consider your philanthropic options.

The charitable gift annuity is a form of charitable gift that provides a lifetime income to the annuitant (usually the donor) and a gift to the charity. The primary purpose of the charitable gift annuity is to support a worthwhile charity, but the lifetime income makes this way of giving attractive to all sorts of donors. Here are a few examples of how a charitable gift annuity helps not only you, but also Iowa State University. Note: All illustrations based on AFR of 3.0% and an annual payment.

Lynda M. Jacobson Assistant Vice President of Development Office of Gift Planning ljacobson@foundation.iastate.edu 515.294.4049 ❙ 800.621.8515

Predictable Retirement Income for Today All her life, Rose (age 80) has been careful to save for a rainy day. And her decision to be a saver has served her well. Earlier this year, Rose worked with a financial advisor to review her financial program. Rose decided to take the money from a maturing CD ($10,000) and direct it toward a charitable gift annuity. The gift annuity will pay her $710 every year as long as she lives, plus, for the next 10 years, about $551 of each payment will be tax-free. And this year, Rose receives a charitable tax deduction of $5,041 that can lower her taxes if she itemizes. Rose considers the charitable gift annuity a great thing — a reliable source of income for her and a substantial charitable gift to us.

The Charitable Gift Annuity: Greater than the Sum of Its Parts Usually, when someone gives something to someone else, the idea is that one person has less and another person has more. But, the charitable gift annuity is different. The donor does not just give; she or he also receives something back. Many donors find the charitable gift annuity a smart way to give and receive for different reasons, including: ■ ■

■ ■

You can have more than one charitable gift annuity. There is generally no maximum contribution limit as there is with a qualified retirement plan. The minimum gift amount is low. Charitable gift annuities are easy to set up and do not need annual maintenance or renewal. Gift annuity payments are for life — you can’t outlive the payment period.

If you’re interested in more information about the charitable gift annuity and how you might help yourself while helping us, send for our complimentary brochure, The Charitable Gift Annuity — Back to Basics. Or, feel free to call or e-mail us directly. It would be our pleasure to help you determine whether a charitable gift annuity is a good match for your philanthropic goals.

Charitable Gift Annuity Payment Rates Age 65 70 75 80 85 90

Rate* 5.3% 5.7 6.3 7.1 8.1 9.5

*Rates as of Feb. 1, 2009. Please contact our office to verify current rates.

Income for Two Harold and Louise (both age 75) have always been careful planners. After celebrating their 50th wedding anniversary, they took a close look at their estate plan to see how they might best manage their resources for the future. Their goals included providing for themselves, their heirs and their favorite charity. One option that came to light was the charitable gift annuity. It seemed to be a great gift idea, since it made it possible to provide a significant gift and receive a fixed, dependable lifetime income. They funded a two-life charitable gift annuity with three different stocks worth a total of $50,000. Every year, the gift annuity will pay out $2,800 as long as Harold or Louise lives. Plus, they received a charitable tax deduction of $17,876 this year. Harold and Louise both enjoy peace of mind from knowing the income is payable for as long as

Find a planning option that benefits you and Iowa State We hope you have found useful ideas in this issue of Insights. To further aid your planning, send for a complimentary copy of the booklets listed below, with no obligation. Simply fill out this tear-off card, fold, tape it on the open end, and drop it in the mail to us. We’ll pick up the postage.

Predictable Income for Later

either of them is alive, and the arrangement is a one-time affair. There is never a need for renewals or additional paperwork.

Income for a Loved One With years of hard work and perseverance, Greta built up her consultancy business. Today, her company employs 20 wonderful people and generates plenty of work. Plus, Greta is ready to retire through an employee buyout, so in a month she will receive a large sum of money. Greta is a great supporter of charity, and she plans to make a major contribution that will create an endowed fund. However, Greta also plans to create a charitable gift annuity based on a gift of $75,000 that will provide help to her mother, Eleanor (age 85), who still lives across town in the small house where Greta grew up. The charitable gift annuity will provide a fixed annual income of $6,075 for Eleanor, which is good because Greta usually sends money each month. And, the charitable gift annuity generates an income tax charitable deduction of $42,392, which also works well for Greta because this will be an unusually high-income year for her due to the sale of her business. Greta is pleased that a charitable gift annuity nicely complements her personal, philanthropic and financial goals.

Dr. Martin knows he will reach the maximum contribution limit for his qualified retirement plan, so he is looking for additional ways to help prepare for retirement. At age 60, he wants to take advantage of opportunities available during his prime income-earning years. One option that interests Dr. Martin is a deferred charitable gift annuity. The deferred charitable gift annuity works just like a regular charitable gift annuity except that the first payment to the annuitant begins a year or more after the gift is made to the charitable organization. And Dr. Martin can choose the date the payments begin. The difference between a deferred charitable gift annuity and a regular gift annuity is the higher payout rate and the higher income tax deduction. Dr. Martin decides to make a gift of $50,000 today and arranges the payments to begin in exactly ten years, allowing him to deduct $20,611 this year. And, in 10 years, Dr. Martin will begin receiving $4,050 once a year for the rest of his life.

Consider Your Options If you are interested in learning more about the charitable gift annuity, please let us know. We are happy to help you explore options for using the gift annuity to meet philanthropic and personal goals.

Please send a complimentary copy of: The Charitable Gift Annuity — Back to Basics, a brochure detailing how gift annuities work, and the benefits for a donor. Personal Financial Affairs: Your Book of Records, a helpful planning guide for documenting important information. I’m interested in a no-cost, no obligation illustration of the benefits of a charitable gift annuity. I’m interested in discussing the various ways to support Iowa State. Please contact me ____ by phone ____ by e-mail to talk about these possibilities.

A Step Further: Now May Be the Time to Consider a Charitable Lead Trust

Please sign me up for your free e-newsletter. E-mail address below.

Many philanthropists face a dilemma. How can they help the organizations they care about without short-changing heirs and loved ones? One potential solution is the charitable lead trust. A charitable lead trust is set up so annual payments are made to a qualified charity such as Iowa State University. When the trust ends, assets can go to the trust beneficiaries — usually family members. A charitable lead trust can be particularly appealing during these economic times for two reasons: (1) in a time of low rates, the grantor pays significantly less in gift or estate taxes for the remainder interest in a charitable lead trust that goes to family and loved ones; and (2) if assets used to fund the trust grow during the trust term, the appreciation is NOT taxed for gift or estate tax purposes.

NAME

ADDRESS

CITY

STATE, ZIP

According to a recent Wall Street Journal article, charitable lead trusts are “especially attractive now” given the low rates. Please contact us if you’re interested in receiving additional information.

TELEPHONE

E-MAIL

INGA0509

Iowa State University Foundation INSIGHTS

2

3

Visit us online at www.isugift.org

4


SPRING 2009

A One-of-a-Kind Accounting Major

INSIGHTS

Charitable Gift Annuity Highlights Fixed, dependable income for life, covering one or two lives.

TAX DEDUCTION

Current income tax charitable deduction.

FLEXIBILITY

Payments can begin now or later.

ACCESSIBLE

Easy to set up, low minimum amount, no ongoing renewals or administration requirements.

A CHARITABLE PLANNING GUIDE FOR ISU ALUMNI AND FRIENDS

Gift Planning Staff: (L-R) Gregg Hinders, Administrative Coordinator Lynda M. Jacobson, Assistant Vice President of Development Paul Caspersen, CFP®, CMFC, Executive Director of Development giftplanning@foundation.iastate.edu 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 rates current at the time of printing and are subject to change. References to estate and income tax include federal taxes only; individual state taxes may further impact results.

OFFICE OF GIFT PLANNING 2505 UNIVERSITY BOULEVARD P. O. BOX 2230 AMES, IA 50010-2230

The Appeal of the Charitable Lead Trust

INCOME

PHONE: 515.294.5398 TOLL-FREE: 800.621.8515 www.withprideandpurpose.org giftplanning@foundation.iastate.edu

Lifetime Income through Charitable Gift Annuities

mented, including a scholarship or endowed faculty position. Giving through a bequest has important advantages for the donor. For example, donors maintain control of their assets during their lifetime, and an estate tax charitable deduction may be available. After considering her goals and opportunities, Fuller did not stop with setting up a scholarship. In celebration of a successful professional career as a certified public accountant in the San Francisco area, she wanted to give more back to her university, so Fuller “I feel fortunate with how my life has turned out and I owe a lot of that created a deferred endowed faculty position in Iowa State’s to the time I spent at Iowa State and College of Business in recognithe education I received.” tion of her valuable experiences on campus. – Donna Johnson Fuller “Like many Iowa State graduates, I’m from a working class family from small town Iowa,” she said. “I feel fortunate with how my life has turned out and I owe a lot of that to the time I spent at Iowa State and the education I received.” When she first arrived on campus, Fuller says she was shy and not very outgoing. But her experiences as the only female accounting major on campus changed that. “I had to fight for what I wanted while I was a student. That changed my whole personality,” she said. “If I wouldn’t have changed at Iowa State and moved to California I wouldn’t have had the life I have now.”

2 Lifetime income through gift annuities 4 The appeal of the charitable lead trust 5 The Donna Fuller Scholarship for women accounting majors

Gerdin Business Building

Donna Fuller

INSIDE THIS ISSUE ...

Visit us online at www.isugift.org 5

IN THIS ISSUE ...

The Donna Fuller Scholarship for Women Accounting Majors

Like many of her fellow Iowa State University alumni, Donna Johnson Fuller has elected to establish a scholarship on campus. She hopes to help current students in a way that was unavailable while she was a student. In Fuller’s case that assistance takes on a whole new meaning because she was one-of-a-kind during her stint as an undergraduate in the 1960s. “I was the only woman accounting major,” says Fuller (B.S., ’68, accounting). “It was a little rough at the beginning, but I had a natural aptitude for accounting and business. I guess the men considered me an oddball and weren’t real nice to me for a year or so. But it didn’t take long for them to realize I could help them instead.” During her undergraduate years, Fuller also worked the swing shift at a local electronics factory. While she says these experiences made her a better person, she has taken steps to smooth the path for those who follow her. More specifically, she has established a bequest to create the Donna Fuller Scholarship for women accounting majors. Individuals like Fuller who establish such a scholarship can do so through a bequest in their will naming the Iowa State

University Foundationas the beneficiary of the funds. This is the easiest and most popular deferred gift plan used by alumni and friends. There are many options available through bequests. Donors may name the Iowa State University Foundation as a percentage beneficiary, or as the recipient of a specific dollar amount or specific assets, or as a residual or contingent recipient. The assets can be used to support Iowa State for the purposes the donor has docu-

IOWA STATE UNIVERSITY FOUNDATION 2505 UNIVERSITY BOULEVARD P.O.B OX 2230 AMES, IA 50010-2230

Donna Fuller Creates a Scholarship for Future Generations

I O WA S TAT E U N I V E R S I T Y F O U N D AT I O N


SPRING 2009

A One-of-a-Kind Accounting Major

INSIGHTS

Charitable Gift Annuity Highlights Fixed, dependable income for life, covering one or two lives.

TAX DEDUCTION

Current income tax charitable deduction.

FLEXIBILITY

Payments can begin now or later.

ACCESSIBLE

Easy to set up, low minimum amount, no ongoing renewals or administration requirements.

A CHARITABLE PLANNING GUIDE FOR ISU ALUMNI AND FRIENDS

Gift Planning Staff: (L-R) Gregg Hinders, Administrative Coordinator Lynda M. Jacobson, Assistant Vice President of Development Paul Caspersen, CFP®, CMFC, Executive Director of Development giftplanning@foundation.iastate.edu 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 rates current at the time of printing and are subject to change. References to estate and income tax include federal taxes only; individual state taxes may further impact results.

OFFICE OF GIFT PLANNING 2505 UNIVERSITY BOULEVARD P. O. BOX 2230 AMES, IA 50010-2230

The Appeal of the Charitable Lead Trust

INCOME

PHONE: 515.294.5398 TOLL-FREE: 800.621.8515 www.withprideandpurpose.org giftplanning@foundation.iastate.edu

Lifetime Income through Charitable Gift Annuities

mented, including a scholarship or endowed faculty position. Giving through a bequest has important advantages for the donor. For example, donors maintain control of their assets during their lifetime, and an estate tax charitable deduction may be available. After considering her goals and opportunities, Fuller did not stop with setting up a scholarship. In celebration of a successful professional career as a certified public accountant in the San Francisco area, she wanted to give more back to her university, so Fuller “I feel fortunate with how my life has turned out and I owe a lot of that created a deferred endowed faculty position in Iowa State’s to the time I spent at Iowa State and College of Business in recognithe education I received.” tion of her valuable experiences on campus. – Donna Johnson Fuller “Like many Iowa State graduates, I’m from a working class family from small town Iowa,” she said. “I feel fortunate with how my life has turned out and I owe a lot of that to the time I spent at Iowa State and the education I received.” When she first arrived on campus, Fuller says she was shy and not very outgoing. But her experiences as the only female accounting major on campus changed that. “I had to fight for what I wanted while I was a student. That changed my whole personality,” she said. “If I wouldn’t have changed at Iowa State and moved to California I wouldn’t have had the life I have now.”

2 Lifetime income through gift annuities 4 The appeal of the charitable lead trust 5 The Donna Fuller Scholarship for women accounting majors

Gerdin Business Building

Donna Fuller

INSIDE THIS ISSUE ...

Visit us online at www.isugift.org 5

IN THIS ISSUE ...

The Donna Fuller Scholarship for Women Accounting Majors

Like many of her fellow Iowa State University alumni, Donna Johnson Fuller has elected to establish a scholarship on campus. She hopes to help current students in a way that was unavailable while she was a student. In Fuller’s case that assistance takes on a whole new meaning because she was one-of-a-kind during her stint as an undergraduate in the 1960s. “I was the only woman accounting major,” says Fuller (B.S., ’68, accounting). “It was a little rough at the beginning, but I had a natural aptitude for accounting and business. I guess the men considered me an oddball and weren’t real nice to me for a year or so. But it didn’t take long for them to realize I could help them instead.” During her undergraduate years, Fuller also worked the swing shift at a local electronics factory. While she says these experiences made her a better person, she has taken steps to smooth the path for those who follow her. More specifically, she has established a bequest to create the Donna Fuller Scholarship for women accounting majors. Individuals like Fuller who establish such a scholarship can do so through a bequest in their will naming the Iowa State

University Foundationas the beneficiary of the funds. This is the easiest and most popular deferred gift plan used by alumni and friends. There are many options available through bequests. Donors may name the Iowa State University Foundation as a percentage beneficiary, or as the recipient of a specific dollar amount or specific assets, or as a residual or contingent recipient. The assets can be used to support Iowa State for the purposes the donor has docu-

IOWA STATE UNIVERSITY FOUNDATION 2505 UNIVERSITY BOULEVARD P.O.B OX 2230 AMES, IA 50010-2230

Donna Fuller Creates a Scholarship for Future Generations

I O WA S TAT E U N I V E R S I T Y F O U N D AT I O N


Now Is an Ideal Time to Make a Difference Without a doubt, times are changing — and challenging. Everyone has been affected by the economy. Nonetheless, many Iowa State University supporters realize that charitable giving remains vitally important — especially now. In the current financial environment, planning strategies that create income, reposition assets, and provide lifetime income for you and your loved ones have become intriguing alternatives to estate and outright gifts. Consequently, the unique benefits found in charitable gift annuities have made them the 2009 gift of choice for many donors. Why? Because a charitable gift annuity is a carefully structured gift that provides you with an opportunity to benefit yourself, your loved ones and Iowa State. How can a charitable gift annuity be used to meet a wide variety of personal goals? The charitable gift annuity is easy to set up, and the rewards more than justify the effort. Take a moment to review the options

What Does It Mean to “Help Us While You Help Yourself?”

outlined below and consider whether the charitable gift annuity may be worth exploring further. If you’re interested in learning more, return the attached card or contact us by phone or e-mail to request our complimentary brochure, The Charitable Gift Annuity — Back to Basics. It would be our pleasure to help you and your advisor(s) as you consider your philanthropic options.

The charitable gift annuity is a form of charitable gift that provides a lifetime income to the annuitant (usually the donor) and a gift to the charity. The primary purpose of the charitable gift annuity is to support a worthwhile charity, but the lifetime income makes this way of giving attractive to all sorts of donors. Here are a few examples of how a charitable gift annuity helps not only you, but also Iowa State University. Note: All illustrations based on AFR of 3.0% and an annual payment.

Lynda M. Jacobson Assistant Vice President of Development Office of Gift Planning ljacobson@foundation.iastate.edu 515.294.4049 ❙ 800.621.8515

Predictable Retirement Income for Today All her life, Rose (age 80) has been careful to save for a rainy day. And her decision to be a saver has served her well. Earlier this year, Rose worked with a financial advisor to review her financial program. Rose decided to take the money from a maturing CD ($10,000) and direct it toward a charitable gift annuity. The gift annuity will pay her $710 every year as long as she lives, plus, for the next 10 years, about $551 of each payment will be tax-free. And this year, Rose receives a charitable tax deduction of $5,041 that can lower her taxes if she itemizes. Rose considers the charitable gift annuity a great thing — a reliable source of income for her and a substantial charitable gift to us.

The Charitable Gift Annuity: Greater than the Sum of Its Parts Usually, when someone gives something to someone else, the idea is that one person has less and another person has more. But, the charitable gift annuity is different. The donor does not just give; she or he also receives something back. Many donors find the charitable gift annuity a smart way to give and receive for different reasons, including: ■ ■

■ ■

You can have more than one charitable gift annuity. There is generally no maximum contribution limit as there is with a qualified retirement plan. The minimum gift amount is low. Charitable gift annuities are easy to set up and do not need annual maintenance or renewal. Gift annuity payments are for life — you can’t outlive the payment period.

If you’re interested in more information about the charitable gift annuity and how you might help yourself while helping us, send for our complimentary brochure, The Charitable Gift Annuity — Back to Basics. Or, feel free to call or e-mail us directly. It would be our pleasure to help you determine whether a charitable gift annuity is a good match for your philanthropic goals.

Charitable Gift Annuity Payment Rates Age 65 70 75 80 85 90

Rate* 5.3% 5.7 6.3 7.1 8.1 9.5

*Rates as of Feb. 1, 2009. Please contact our office to verify current rates.

Income for Two Harold and Louise (both age 75) have always been careful planners. After celebrating their 50th wedding anniversary, they took a close look at their estate plan to see how they might best manage their resources for the future. Their goals included providing for themselves, their heirs and their favorite charity. One option that came to light was the charitable gift annuity. It seemed to be a great gift idea, since it made it possible to provide a significant gift and receive a fixed, dependable lifetime income. They funded a two-life charitable gift annuity with three different stocks worth a total of $50,000. Every year, the gift annuity will pay out $2,800 as long as Harold or Louise lives. Plus, they received a charitable tax deduction of $17,876 this year. Harold and Louise both enjoy peace of mind from knowing the income is payable for as long as

Find a planning option that benefits you and Iowa State We hope you have found useful ideas in this issue of Insights. To further aid your planning, send for a complimentary copy of the booklets listed below, with no obligation. Simply fill out this tear-off card, fold, tape it on the open end, and drop it in the mail to us. We’ll pick up the postage.

Predictable Income for Later

either of them is alive, and the arrangement is a one-time affair. There is never a need for renewals or additional paperwork.

Income for a Loved One With years of hard work and perseverance, Greta built up her consultancy business. Today, her company employs 20 wonderful people and generates plenty of work. Plus, Greta is ready to retire through an employee buyout, so in a month she will receive a large sum of money. Greta is a great supporter of charity, and she plans to make a major contribution that will create an endowed fund. However, Greta also plans to create a charitable gift annuity based on a gift of $75,000 that will provide help to her mother, Eleanor (age 85), who still lives across town in the small house where Greta grew up. The charitable gift annuity will provide a fixed annual income of $6,075 for Eleanor, which is good because Greta usually sends money each month. And, the charitable gift annuity generates an income tax charitable deduction of $42,392, which also works well for Greta because this will be an unusually high-income year for her due to the sale of her business. Greta is pleased that a charitable gift annuity nicely complements her personal, philanthropic and financial goals.

Dr. Martin knows he will reach the maximum contribution limit for his qualified retirement plan, so he is looking for additional ways to help prepare for retirement. At age 60, he wants to take advantage of opportunities available during his prime income-earning years. One option that interests Dr. Martin is a deferred charitable gift annuity. The deferred charitable gift annuity works just like a regular charitable gift annuity except that the first payment to the annuitant begins a year or more after the gift is made to the charitable organization. And Dr. Martin can choose the date the payments begin. The difference between a deferred charitable gift annuity and a regular gift annuity is the higher payout rate and the higher income tax deduction. Dr. Martin decides to make a gift of $50,000 today and arranges the payments to begin in exactly ten years, allowing him to deduct $20,611 this year. And, in 10 years, Dr. Martin will begin receiving $4,050 once a year for the rest of his life.

Consider Your Options If you are interested in learning more about the charitable gift annuity, please let us know. We are happy to help you explore options for using the gift annuity to meet philanthropic and personal goals.

Please send a complimentary copy of: The Charitable Gift Annuity — Back to Basics, a brochure detailing how gift annuities work, and the benefits for a donor. Personal Financial Affairs: Your Book of Records, a helpful planning guide for documenting important information. I’m interested in a no-cost, no obligation illustration of the benefits of a charitable gift annuity. I’m interested in discussing the various ways to support Iowa State. Please contact me ____ by phone ____ by e-mail to talk about these possibilities.

A Step Further: Now May Be the Time to Consider a Charitable Lead Trust

Please sign me up for your free e-newsletter. E-mail address below.

Many philanthropists face a dilemma. How can they help the organizations they care about without short-changing heirs and loved ones? One potential solution is the charitable lead trust. A charitable lead trust is set up so annual payments are made to a qualified charity such as Iowa State University. When the trust ends, assets can go to the trust beneficiaries — usually family members. A charitable lead trust can be particularly appealing during these economic times for two reasons: (1) in a time of low rates, the grantor pays significantly less in gift or estate taxes for the remainder interest in a charitable lead trust that goes to family and loved ones; and (2) if assets used to fund the trust grow during the trust term, the appreciation is NOT taxed for gift or estate tax purposes.

NAME

ADDRESS

CITY

STATE, ZIP

According to a recent Wall Street Journal article, charitable lead trusts are “especially attractive now” given the low rates. Please contact us if you’re interested in receiving additional information.

TELEPHONE

E-MAIL

INGA0509

Iowa State University Foundation INSIGHTS

2

3

Visit us online at www.isugift.org

4


SPRING 2009

A One-of-a-Kind Accounting Major

INSIGHTS

Charitable Gift Annuity Highlights Fixed, dependable income for life, covering one or two lives.

TAX DEDUCTION

Current income tax charitable deduction.

FLEXIBILITY

Payments can begin now or later.

ACCESSIBLE

Easy to set up, low minimum amount, no ongoing renewals or administration requirements.

A CHARITABLE PLANNING GUIDE FOR ISU ALUMNI AND FRIENDS

Gift Planning Staff: (L-R) Gregg Hinders, Administrative Coordinator Lynda M. Jacobson, Assistant Vice President of Development Paul Caspersen, CFP®, CMFC, Executive Director of Development giftplanning@foundation.iastate.edu 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 rates current at the time of printing and are subject to change. References to estate and income tax include federal taxes only; individual state taxes may further impact results.

OFFICE OF GIFT PLANNING 2505 UNIVERSITY BOULEVARD P. O. BOX 2230 AMES, IA 50010-2230

The Appeal of the Charitable Lead Trust

INCOME

PHONE: 515.294.5398 TOLL-FREE: 800.621.8515 www.withprideandpurpose.org giftplanning@foundation.iastate.edu

Lifetime Income through Charitable Gift Annuities

mented, including a scholarship or endowed faculty position. Giving through a bequest has important advantages for the donor. For example, donors maintain control of their assets during their lifetime, and an estate tax charitable deduction may be available. After considering her goals and opportunities, Fuller did not stop with setting up a scholarship. In celebration of a successful professional career as a certified public accountant in the San Francisco area, she wanted to give more back to her university, so Fuller “I feel fortunate with how my life has turned out and I owe a lot of that created a deferred endowed faculty position in Iowa State’s to the time I spent at Iowa State and College of Business in recognithe education I received.” tion of her valuable experiences on campus. – Donna Johnson Fuller “Like many Iowa State graduates, I’m from a working class family from small town Iowa,” she said. “I feel fortunate with how my life has turned out and I owe a lot of that to the time I spent at Iowa State and the education I received.” When she first arrived on campus, Fuller says she was shy and not very outgoing. But her experiences as the only female accounting major on campus changed that. “I had to fight for what I wanted while I was a student. That changed my whole personality,” she said. “If I wouldn’t have changed at Iowa State and moved to California I wouldn’t have had the life I have now.”

2 Lifetime income through gift annuities 4 The appeal of the charitable lead trust 5 The Donna Fuller Scholarship for women accounting majors

Gerdin Business Building

Donna Fuller

INSIDE THIS ISSUE ...

Visit us online at www.isugift.org 5

IN THIS ISSUE ...

The Donna Fuller Scholarship for Women Accounting Majors

Like many of her fellow Iowa State University alumni, Donna Johnson Fuller has elected to establish a scholarship on campus. She hopes to help current students in a way that was unavailable while she was a student. In Fuller’s case that assistance takes on a whole new meaning because she was one-of-a-kind during her stint as an undergraduate in the 1960s. “I was the only woman accounting major,” says Fuller (B.S., ’68, accounting). “It was a little rough at the beginning, but I had a natural aptitude for accounting and business. I guess the men considered me an oddball and weren’t real nice to me for a year or so. But it didn’t take long for them to realize I could help them instead.” During her undergraduate years, Fuller also worked the swing shift at a local electronics factory. While she says these experiences made her a better person, she has taken steps to smooth the path for those who follow her. More specifically, she has established a bequest to create the Donna Fuller Scholarship for women accounting majors. Individuals like Fuller who establish such a scholarship can do so through a bequest in their will naming the Iowa State

University Foundationas the beneficiary of the funds. This is the easiest and most popular deferred gift plan used by alumni and friends. There are many options available through bequests. Donors may name the Iowa State University Foundation as a percentage beneficiary, or as the recipient of a specific dollar amount or specific assets, or as a residual or contingent recipient. The assets can be used to support Iowa State for the purposes the donor has docu-

IOWA STATE UNIVERSITY FOUNDATION 2505 UNIVERSITY BOULEVARD P.O.B OX 2230 AMES, IA 50010-2230

Donna Fuller Creates a Scholarship for Future Generations

I O WA S TAT E U N I V E R S I T Y F O U N D AT I O N


Insights Summer 2009