An endowment fund is an account in which the principal amount donated is retained and not expended but the income earned is used by the Center as needed. The donor may name the endowment, linking themselves or a loved one to the work of the Center.
Charitable Lead Trust (CLT)
In a CLT, income generated by assets placed in trust is paid to the Center for a designated number of years, after which the assets pass to non-charitable beneficiaries named by the donor. This income is excluded from the donor’s yearly taxable income for the term of the trust, resulting in a reduced income tax. Also, since the value of the remainder trust is discounted by IRS tables, this kind of gift may enable a donor to make a large, deferred gift to heirs at a low gift tax cost.
A bequest is a gift made through a will or living trust as a long-lasting expression of your love and support for the Center’s work after your lifetime. It may be added to an existing will through a codicil. Types of bequests include:
Specific (dollar amount or fraction of the estate)
Residuary (names the Center as the residuary legatee, to receive the remainder of the estate after specific legacies have been fulfilled)
Contingent (takes effect only when all primary beneficiaries named in the will die)
Testamentary trust (trust income is paid to one or more beneficiaries, upon whose death the principal is paid to the Center)
If you wish to include the Center in your will, you might suggest the following language to your attorney:
I give, devise, and bequeath to the Neighborhood Center, Inc., Fed Tax ID#210-634-537/000, a 501(c)(3) nonprofit at 278 Kaighns Ave., Camden, NJ 08103:
$_______ (or X asset or ______%) [Specific]
_______% of the remainder of my estate [Residuary]
as an unrestricted gift to be used by the Center wherever the need is greatest.
Charitable Remainder Unitrust (CRUT)
A CRUT irrevocably transfers the remainder interest of an asset’s value to the Center upon the death of named income beneficiaries (the donor and/or others) or at the end of a specified term of years (lifetime up to a maximum of 20 years). The donor receives a tax deduction for the charitable remainder interest in the year the trust is established with no capital gains tax due on appreciated securities contributed to the unitrust. Unitrust gifts are defined by the manner in which income is paid.
Charitable Remainder Annuity Trust (CRAT)
Like the CRUT, a CRAT transfers the remainder interest to the Center upon the death of named income beneficiaries.