You can protect the ocean and marine life while receiving tax benefits from these generous gifts.
Since Ocean Conservancy is tax-exempt, making Ocean Conservancy a beneficiary of your retirement plan means that 100% of your gift passes to the organization, which may possibly reduce income and estate taxes that might otherwise be due.
|Beneficiaries||Your Heirs||Ocean Conservancy|
|Net to Beneficiary||$63,000||$100,000|
|*Based on 2018 maximum income tax rate of 37%.|
Charitable Distribution from an IRA
Making a qualified charitable distribution from an IRA to Ocean Conservancy is a great way to reduce your taxable income.
Here’s how it works:
- You must be 70½ or older.
- An individual may transfer up to a total of $100,000 per year, and a married couple may give up to $200,000.
- Your gift must be transferred directly from your IRA account to Ocean Conservancy.
- Your gift is a transfer of funds from your IRA to Ocean Conservancy, so while you do not receive a charitable deduction, it does not create taxable income for you.
- The transfer of funds can count towards your annual Required Minimum Distribution* from your IRA as long as your gift is received by December 31. If you are using a checkbook issued by your IRA administrator to make your gift, please send your gift as early as possible to ensure that it qualifies for a distribution in the current year.
If you’re interested in this popular way to support Ocean Conservancy, request a sample letter for your IRA administrator here.
* Congress has waived the annual Required Minimum Distribution from IRA Accounts in the year 2020 as part of the CARES Act in response to COVID-19. Please consider seeking advice from your financial advisor or tax professional to understand how recent changes to laws governing retirement plans may impact you and your charitable gift.
A Charitable Gift Annuity Funded with Appreciated Securities
If you have stocks or mutual funds that you have held a year or longer you can use them to fund a charitable gift annuity. By doing so, you will avoid a significant portion of the capital gains tax that would otherwise be owed. The remaining gain will be equally allocated over several years of your annuity payments and will not be taxed all at once.
EXAMPLE: Betty, age 75, establishes a gift annuity using stock that cost her $1,500, and is now valued at $25,000. She will receive annual payments of $1,500 for life and get an immediate charitable gift deduction of approximately $10,309. She avoids almost $9,700 in capital gains taxes that would be otherwise owed.
Charitable Remainder Trust
This variable income trust pays out a percentage of assets, valued annually. For your donation, you receive an immediate income tax deduction for a portion of your contribution to the unitrust and savings on capital gains taxes if you use appreciated property.
Virginia and Howard have been members of Ocean Conservancy for years. They care deeply about Ocean Conservancy and its future, and have decided to transfer an asset, which they originally purchased years ago for $200,000 and is now worth $400,000, into a 5 percent Unitrust. They are both 67. The results:
- They avoid $60,000* in capital gains taxes.
- The first year, they receive $20,000 income from the trust. (Future income will rise or fall with the trust asset value.)
- They receive a charitable income tax deduction for remainder value.
- They support Ocean Conservancy and ensure a healthy ocean for generations to come!
* Assumes a federal capital gains rate of 20 percent
Complimentary Planning Resources Are Just a Click Away!
Your Giving Toolkit
Need assistance? We're here to help!
The content found on this site is general in nature and intended to be used for informational purposes only. It should not be relied upon as legal, tax, accounting or other professional advice. To determine how a gift or estate planning decision might affect your particular circumstances, it is expressly recommended that you consult an attorney, financial advisor or other qualified professional.