Giving should never feel like an obligation.
That means we’ll never pressure you to give funds to the Sharing God’s Grace campaign. However, you may not have considered some of these creative giving opportunities that fall outside the typical cash gift. Often, these other forms of gifts will offer additional benefits to you as the donor.
Please be in prayer as you consider the following ways to give. Remember:
“He will always make you rich enough to be generous at all times, so that many will thank God for your gifts which they receive from us.”
(2 Corinthians 9:11)
Types of Outright Gifts
- Paid-up Insurance Policies
- Personal Property
- Publicly Traded Securities
- Real Estate
- Closely-Held Stock
- Charitable Lead Trusts
- Deferred Gifts
Paid-up Insurance Policies
Many times, families have paid-up life insurance policies that were originally taken out to cover mortgage expenses or pay for college for a child. If these reasons are no longer an issue, a paid-up insurance policy can be a wonderful way to make a gift to the church. The tax deduction is equal to the replacement value or the donor’s cost in the policy, whichever is less. The church will have the option of retaining the policy or taking the current cash surrender value.
One can make a gift of personal property to Grace United Methodist Church to help support the program. These items can include antiques, works of art, jewelry, coin or stamp collections, as well as other valuable assets. However, these items are generally tax deductible at their base cost and not their fair-market value. These gifts will be sold and the proceeds will be applied toward the capital program.
Publicly Traded Securities
Long-term appreciated capital gain property (such as stock) is one of the most common ways to make additional capital gifts. These gifts are tax deductible at the full fair-market value subject to some limitations. However, the gain is not subject to taxation to the donor or the church. For information or questions about transferring publicly traded securities, contact Rev. Dr. Joel Catlin at 347-7131.
Example: Donor paid $2,000 for stock now worth $10,000. If donor sells stock, he/she pays $1,600 in capital gains taxes and keeps $8,400. If donor gives stock to church, neither donor nor the church pays taxes and donor receives $10,000 charitable deduction reducing taxable income.
Appreciated Real Estate
A gift of real estate will generate a tax deduction for the full appraised fair-market value. Like securities, the capital gain is not taxable to the donor or the church. Sometimes a donor has a parcel of real estate that they are willing to gift, but they want to retain some of its value for themselves. A bargain sale is a good way to make a gift to the church and keep some of the value.
Example: Donor has a parcel of real estate worth $100,000. He/she sells the property to the church for $50,000. The donor has made a charitable gift of $50,000 to the church and received cash for him/herself. The tax deduction is equal to the difference between the selling price and the appraised price.
Gifts of closely-held stock are virtually the same as publicly traded securities, but may carry additional benefits to the donor. Along with the income tax deduction, gifting closely-held stock is a good way of reducing company-retained earnings and transferring ownership of the company to children or grandchildren.
Charitable Lead Trusts
A lead trust can be established to provide income to the church for a specified term of years. After the term of years, the assets in the trust revert back to the donor or to individual(s) designated by the donor. Cash, securities and some types of real estate can be used to fund the trust. There is no income tax deduction for this type of gift, but there is an estate tax savings.
Deferred gifts are gifts that are received sometime in the future by the church. During that time the donor retains an interest in the assets.
- Estate Notes
- Charitable Remainder Trusts
- Charitable Gift Annuities
- “Pay on Death” Accounts
- IRA Beneficiary
- Life Insurance
This information is for informational purposes only and does not constitute individual financial, investment, tax, accounting or legal advice. For more information on ways to give, contact the Leadership Team.