There are many ways to give a deferred gift to the MCC Foundation including retirement funds, wills, life insurance, trusts, charitable gift annuities, and gifts of stock or real estate. Please keep in mind that the information provided here is not intended to replace the advice of your professional advisors. We would appreciate the opportunity to discuss with you the many options available for deferred giving. There is no obligation or charge. We would also be happy to confer with your financial planner, CPA, trust officer or attorney at your request.
An individual may name the MCC Foundation as a beneficiary of his retirement plan account. The Foundation may be a 100% beneficiary at the time the person passes away (if there is any unused retirement money) or may be named as a partial beneficiary, sharing the remaining funds with others. Currently, a retirement fund still owned by the retired person will be included in his taxable estate, but a charitable deduction may be allowed for the amount of the bequest to charity. Naming the MCC Foundation as a retirement account beneficiary is a simple way to fund a charitable bequest. Donors are advised to consult with their tax advisor to be sure this option is advantageous and workable in their particular estate situation. The MCC Foundation can accept current distributions from IRA's. Donors over 70 may authorize such distributions up to $100,000 per year. These distributions may avoid complicating the donors individual tax return and therefore be tax-wise.
One way to give a deferred gift to MCC is to name the MCC Foundation as a beneficiary in your will. One simple way to accomplish this is by executing a codicil (amendment) to your will. This simple signed, dated and witnessed paragraph can be attached to your will without having to redraw the original. A fixed amount, percentage, or remainder may be designated for the McLennan Community College Foundation, and a purpose may also be stipulated for the use of the bequest. It is also suggested that The MCC Foundation be named as a charity of choice in your obituary to encourage others to give to the Foundation, perhaps to the fund you have supported or endowed.
Another simple way to provide a bequest is to insert the words "in trust for McLennan Community College Foundation" after your name on a bank account, mutual fund, money market account, or stock purchase. You retain exclusive ownership and control over the account. (You can modify or close out the account at any time). If anything still remains in the account at your death, the account automatically becomes the property of the Foundation without having to go through probate. Gifts transferred to the Foundation at death may be deductible for federal estate tax purposes.
Most people own life insurance, and many times the original purpose for which the insurance was purchased is no longer applicable. For example, an individual may have purchased insurance to cover the cost of a child’s college education if he/she were to die prematurely. The husband and wife may have initially purchased insurance to provide support for minor children who are now married with children of their own. You may donate the policy to the McLennan Community College Foundation by:
- Naming the McLennan Community College Foundation as the owner and beneficiary of an existing life insurance policy. You may receive an immediate federal income tax charitable deduction equal to your adjusted basis in the policy (not face value). Future premiums paid by you may also be tax deductible.
- Naming the McLennan Community College Foundation as the charitable beneficiary of a life insurance policy. Although there is no immediate income tax charitable deduction, your estate will be entitled to an estate tax deduction for the proceeds payable to the McLennan Community College Foundation.
- Purchasing a new life insurance policy and naming the McLennan Community College Foundation both the owner and the beneficiary. By paying the yearly premiums, you may claim each year a federal income tax deduction for the full value of the premiums.
- Using the group life insurance provided by your employer. If your employer provides you with group term life insurance in excess of $50,000, you must include the cost of insurance in excess of $50,000 in your gross income for each taxable year. However, if you name the McLennan Community College Foundation as the sole beneficiary of the insurance in excess of $50,000 for the entire tax year, the cost of such excess coverage may be excludable from your taxable income.
There are several types of trusts, which are excellent vehicles for: preserving your assets, increasing your current income, reducing income, estate, and capital gains tax obligations, avoiding the costs and public scrutiny of probate, possibly increasing your bequests to your heirs, and providing a legacy for your favorite charities. Your attorney, CPA or financial advisor can provide the details on how you can best accomplish your goals.
Charitable Gift Annuities
A Charitable Gift Annuity represents an excellent way to provide a charitable contribution to the MCC Foundation while you receive an income for life. That income may also continue for a second annuitant. The potential income tax deduction is measured by the difference between the gift to the foundation and the present value of the annual income expected to be paid over the annuitant’s life expectancy. The MCC Foundation Charitable Gift Annuity offers a guaranteed annual income backed by the multimillion-dollar assets of the MCC Foundation. It does not depend on the uncertainties of the stock and bonds markets nor on how long you live. You could outlive the dollars originally used to establish the annuity, but you continue to receive the annual income you were guaranteed when you first enrolled. Please contact the MCC Foundation office at 254-299-8606 for more information.
Gifts of Stock or Real Estate
You maybe be able to avoid the tax on gains on the sale of stock(public or private), real estate or other assets by gifting such assets to the MCC Foundation prior to sale. You may still be entitled to a charitable income tax deduction for the full value of the stock while avoiding the tax on the gain. Please call us for details or consult your tax advisor.