Retirement plans are among the most highly taxed assets one can own, subject to income tax and estate tax that can deplete the value significantly. By naming Beagle Freedom Project as the beneficiary of your retirement plan, the retirement funds remaining at your death are not taxed and your heirs have no “hidden” income tax liability.

Another very efficient way to give retirement plan assets to Beagle Freedom Project is through the IRA Charitable Rollover. Under the IRA Charitable Rollover, for eligible tax years, individuals age 70½ or over could exclude up to $100,000 from gross income for donations paid directly to a qualified charity from their IRA. Key points about qualified charitable contributions (QCDs) include:

Married individuals filing a joint return could exclude up to $100,000 donated from each spouse’s own IRA ($200,000 total).

• The donation satisfies any IRA required minimum distributions for the year.
• The amount excluded from gross income isn’t deductible.
• Donations from an inherited IRA are eligible if the beneficiary is at least age 70 ½.
• Donations from a SEP or SIMPLE IRA are not eligible.
• Donations from a Roth IRA are also eligible.

As in all charitable gift decision-making, review with one’s advisor and attorney is encouraged.

Another effective way to donate to Beagle Freedom Project is through a gift of life insurance, which, depending on how the donation is accomplished, can have tax advantages, as well as the benefit of generally avoiding probate, creditor’s claims and contests by heirs.

There are two basic ways to make a gift of life insurance: (1) an irrevocable gift of a new or existing policy where the donor gives up all incidents of ownership, or (2) by naming Beagle Freedom Project as the outright or contingent beneficiary of a policy. Each approach has advantages and disadvantages and you should discuss them with your lawyer, advisor and accountant.

Irrevocable gift of an existing life insurance policy: If you own life insurance, you might consider making an irrevocable gift of the policy to Beagle Freedom Project. If complete ownership is transferred to Beagle Freedom Project and BFP is named as the beneficiary, the gift will generate a charitable income tax deduction.

Irrevocable gift of a new policy: You may take out a new policy and irrevocably name Beagle Freedom Project as the owner and the beneficiary. Whether you make one single premium payment for the policy or pay premiums annually, each payment produces a charitable income tax deduction.

Naming the charity as a primary or contingent beneficiary: You may also name Beagle Freedom Project as either the primary or contingent beneficiary of the policy. However, this option will not produce an income tax charitable deduction for the payment of future premiums on the policy, but it does provide a full estate tax charitable deduction at death.

Gifts of real estate can include homes, undeveloped land and parcels of land, condominiums, apartments, farmland, and rental property. A gift of this kind can alleviate capital gains taxes, income taxes, and brokers fees as well as management costs and responsibilities, while Beagle Freedom Project can receive income or generate capital from your gift.

Another method to donate to Beagle Freedom Project is through a species of charitable remainder trust. A charitable remainder trust is a trust which provides for: (1) a definite distribution, at least annually; (2) to one or more beneficiaries, at least one of which is not a charity, such as BFP; (3) for life or for a term of years; (4) with an irrevocable remainder interest to be held for the benefit of, or paid over to, charity.

There are two types of charitable remainder trusts: a (1) charitable remainder annuity trust, or a (2) charitable remainder unitrust. Whether a charitable remainder trust is a charitable remainder annuity trust or a charitable remainder unitrust depends essentially on how the specified distributions to the beneficiaries are determined. In the case of an charitable remainder annuity trust, the specified distribution must be a sum certain that is not less than five percent of the initial fair market value of all assets placed in trust. In the case of a unitrust, the specified distribution must be a fixed percentage that is not less than five percent of the net fair market value of the trust assets, valued annually.

The IRS typically issues a series of revenue ruling and revenue procedures that provide specimen (sample) trust agreements for various types of charitable remainder trusts. When a trust is drafted that contains provisions substantially similar to those provided in the appropriate sample, the IRS may recognize the trust as satisfying all the requirements of the law and and regulations. Consequently, your attorney, or whatever professional assists you in drafting your trust agreement, might not have to request a ruling from the IRS on the qualifications of your charitable remainder trust as drafted.

A charitable remainder trust has several benefits. The client can control the distribution of her/his social capital by naming the charitable remainderman of the trust. As opposed to an outright gift to charity, a charitable remainder trust allows the client grantor to make a charitable gift while retaining some benefit, either for him/herself or others, from the property transferred. Also, no capital gain taxes are due on the transfer of the assets into the charitable remainder trust. This is because when the property in the trust is sold, the trust does not have to pay any capital gain taxes. This gain, in turn, might be used to benefit income beneficiaries for several years.

The charitable remainder trust also allows for a fair amount of flexibility in selecting the timing and the pay-out of the income stream, permitting it to be distributed during the client’s lifetime or for a period of years. This payout, then, can be specifically tailored to meet each client’s individual needs.

Finally, certain income and estate tax deductions may be generated by the creation of a charitable remainder trust.

Talk to your estate planner or attorney to discuss donating to Beagle Freedom Project through a charitable remainder trust.