Frequently Asked Questions
- How do I leave a gift to PATH in my will?
Naming PATH as a beneficiary in a will is one of the most popular planned gifts to PATH. For many donors, a bequest offers the opportunity to make a more substantial gift than would be possible during the donor's lifetime. Other donors view a bequest as an opportunity to give a lasting legacy to PATH. Bequests are one of the simplest forms of planned giving and have been important in supporting PATH's endowment, among other things.
Bequests may include stocks, bonds, real estate, or retirement-plan assets. Other assets may also be willed to PATH. You can give a specific dollar amount or a percentage of your estate. You even can name PATH as a residual beneficiary. This means that PATH will receive the remainder of your estate after all other bequests and taxes have been satisfied.
If you would like to remember PATH through a bequest, it is very important that this estate gift be correctly worded. Please review our suggested sample bequest language, which provides the language to record your wishes in your will.
- Does PATH need to know my bequest intentions?
We recognize that you might want to keep your bequest intentions confidential. If you are willing to inform us, however, we appreciate the information. Including PATH in your will makes you eligible to become a member of the PATH Futures Legacy Society. Recognizing members of this society is important to PATH. Not only does it provide us with an opportunity to express our appreciation, but it also may inspire others to support PATH through their estate plans.
- How do gifts in trust work?
Gifts in trust, like charitable gift annuities, are types of life-income plans. Life-income plans are arrangements under which you make a gift of cash or property (stocks, bonds, real estate) in exchange for a stream of income for life. In other words, you transfer an asset, but reserve the right to receive payments from the asset.
There are several benefits from this type of gift arrangement:
- A stream of income for life, to more than one beneficiary if you wish
- A charitable income-tax deduction in the year you make the gift, plus a carryover of up to five years of any unused deduction
- A charitable estate-tax deduction for a portion of the gift
- A gift that will benefit PATH in the future
Life-income gifts may be made in the form of trusts or gift annuities. In its simplest terms, a trust is an arrangement under which an individual transfers legal title to property to another (the trustee) who manages the property for the benefit of the individuals and/or organization specified in the trust agreement.
Trusts that make lifetime payments to the specified beneficiaries and ultimately benefit a charity are known as charitable remainder trusts. At PATH, these trusts may take the form of either a charitable remainder unitrust or a charitable remainder annuity trust.
The principal difference between these trusts is the nature of the payments made to the beneficiaries:
Payments from a unitrust vary according to the value of the trust each year. Payments from an annuity trust are fixed when the trust is created and will not vary over the lifetimes of the beneficiaries.
Pointer: If you fund any of these trusts with long-term appreciated securities, you will receive the benefits listed above plus an additional tax benefit: you will avoid capital-gain tax on the appreciation, thus preserving more of your gift to produce the payments.
To learn more about gifts in trust, please check our Web site here.
- May I name PATH as the beneficiary of a life insurance policy?
Yes. An asset that is frequently overlooked is life insurance. If the original need for which a policy was purchased no longer exists (for example, to pay for a child's Y education in the event of one's premature death), a gift of this asset can be very rewarding. To qualify for a tax deduction, you would need to name PATH as both the beneficiary and the owner of the policy.
You also may consider using life insurance when you make a gift of another asset (highly appreciated real estate, for example), but wish to replace the value of that asset for your family. By using the actual tax savings generated by your gift to purchase a life insurance policy, you can replace the value of the gift in your estate for the benefit of your family.
- May I name PATH as the beneficiary of a retirement account?
Yes. You may use retirement-plan benefits to make a gift to PATH. And because of the estate and income-tax treatment of retirement-plan benefits, the cost of your gift to your estate and heirs is often relatively small. Retirement-plan benefits include assets held in individual retirement accounts (IRAs) and assets held in accounts under 401(k) plans, profit-sharing plans, Keogh plans, and 403(b) plans.
- Can assets other than cash be used to fund a planned gift to PATH?
Yes. Donating long-term appreciated assets such as securities or real estate may bring even more benefits to a donor. By giving these assets to PATH to establish a planned gift such as a charitable gift annuity or charitable remainder trust, a donor can reduce capital-gain tax liability and still receive a charitable deduction and other tax and income benefits.
- Does PATH accept gifts of real estate?
Yes. A personal residence, a farm, a vacation home, and commercial and rental property are often the subject of gifts. Like gifts of long-term, appreciated securities, gifts of real estate can be very attractive because of the double tax benefit: an immediate charitable deduction and the avoidance of capital-gain tax.
However, family considerations may not permit the making of an outright gift of your personal residence or farm. In that case, you may want to consider a gift to us of a retained life estate in such property. Even though you will retain the right to possess and enjoy the property for as long as you (and your spouse) live, you'll obtain a current income-tax deduction for the present value of our remainder interest.
- Will PATH work with my financial advisor as I plan a gift to PATH?
Yes. PATH encourages donors to talk with their advisors about their plans. We are willing to work with you and your advisors to determine the best course of action to achieve your wishes.
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