Gifts that benefit your heirs
Charitable lead trusts
Charitable lead trusts share trust income with a charity over a period of years. Donors fund a charitable lead trust by transferring cash or other assets to their trust. The trust will then make payments to charity on a fixed schedule for a term of years, such as the life of one or more individuals. When the trust term expires, the remaining trust assets are transferred to non-charitable beneficiaries – usually going back to the donor or family members. Charitable lead trusts may produce tax deductions for donors and may reduce estate and gift taxes to heirs.
Gifts of retirement plan assets
Naming Catholic Charities as a beneficiary of your retirement account can be an easy way to make a legacy gift and reduce taxes to your loved ones.
If you leave your retirement plan to your children, they will have to pay income tax on its distribution. Catholic Charities does not pay this tax, so 100% of your gift will be used to support its mission. Here’s an example of what this can mean to your heirs:
A widower died and left his $300,000 house to charity and his $300,000 retirement plan to his relatives. He should have done just the opposite. The relatives had to pay income tax on the $300,000 in the retirement plan, an $80,000 cost to them. If they had received the home, and the charity had received the retirement plan payment, no one would have paid income tax.
To make a gift of retirement plan assets, simply ask your plan administrator for a beneficiary designation form and name Catholic Charities as a primary or contingent beneficiary of your retirement account.