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Planned giving may be mistakenly seen as something for the wealthy, but anyone can make a charitable gift - during lifetime or at death - which provides the donor financial, estate and tax benefits while helping to secure the long-term existence of the charity.

The Foundation of the Roman Catholic Diocese of Albany, NY, Inc., was established in 1995. It is a separate, tax-exempt charity whose purpose is to advance the mission of the Church of Albany. The foundation seeks and manages planned gifts and endowment funds for the Diocese and its entities: for example, Catholic Charities, vocations, priests' retirement, parishes, Catholic schools and the Cathedral of the Immaculate Conception in Albany.

Forms of planned giving include a bequest under a will, a gift of a life insurance policy and a gift of appreciated stocks, bonds or other assets. There are also other forms, including a gift from a donor's retirement account, a gift of real estate and a charitable gift annuity.

Planned giving can be done with the use of trusts, such as a charitable remainder trust or a charitable lead trust, or can take the form of a charitable gift annuity.

A charitable gift annuity, sponsored by the Diocese, is an irrevocable contract between the Diocese and the donor to pay to the donor a specific annuity for life (or for two lives). The minimum age is 65 and the minimum investment is $10,000.

The annuity rate is set by the American Council of Gift Annuities; the program is supervised by the New York State Office of Financial Services. The rate for a donor of age 70, for life, is 5.1 percent. Upon the donor's death, the principal goes to a religious, charitable or educational institution, program or service of the Diocese.

There are other forms of planned giving where the donor receives income: a charitable remainder trust, which provides an annuity or unitrust amount to the donor for life and the remainder, upon death, to charity; and a charitable lead trust, which provides an annuity amount to a charity for a term of years and the remainder to the heirs of the donor.

Some Catholics want to remember the Diocese or a parish in a will or trust. The wording to use is, "to (legal name of entity), the sum of $_________ for its general uses and purposes" (or for a specific purpose: scholarships, Catholic Charities, programs, services and the like).

Donors can also name the Diocese or one of its entities as the beneficiary of a life insurance policy, or transfer ownership of the policy to the Diocese; the donor would remain the insured. As the owner of the policy, the Diocese would select the beneficiary to receive the policy's proceeds upon the donor's death. A donor can make a cash donation to the Diocese to pay the premiums, or the Diocese would pay the premiums from its general account.

There is no income tax deduction for changing the beneficiary of the policy. The donor's estate would receive an estate tax deduction equal to the value of the proceeds going to charity. If a donor transfers ownership of the policy, he or she receives an income tax deduction equal to the value of the policy and an income tax deduction for any gift of cash to pay premiums.

Some donors wonder about selling stocks and giving the proceeds to the Diocese. A better alternative would be to transfer ownership of the stocks to the Diocese and allow it to sell the stock, so that the donor is entitled to an income tax deduction for the full fair market value of the stock and avoids capital gains tax on the sale.

One form of giving is no longer allowed: making a withdrawal from one's IRA directly to charity without tax consequences. Late last year, Congress reinstituted the Charitable IRA Rollover rules, which would allow tax-free withdrawals to charity. This most recent version of the law expired Dec. 31, 2014. Donors can consult with tax advisors; 2015 tax law changes may reinstitute this form of giving.

If you're interested in planned giving, discuss it with your family, attorney, accountant and financial advisor. The foundation's website, www.foundationrcda.org, has information regarding the various religious, charitable and educational institutions, programs and services of the Roman Catholic Diocese of Albany; for more information, call 453-6657.

(Mr. Macari is a parishioner of Sacred Heart Church in Troy and a partner in the law firm of Martin, Shudt, Wallace, DiLorenzo and Johnson. He concentrates in the areas of estate planning, estate administration law, business law, taxation and real estate law.) [[In-content Ad]]

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