Maximize Charitable Giving
Giving is important to you. It's good for the soul, and it's good for your financial life, too.
People make charitable donations for a number of reasons. Among the most common are to leave a lasting imprint on society or to memorialize someone. But don't be ashamed to list tax breaks among your reasons for giving. Our country's well-being relies on public donations, which is why the U.S. government provides taxpayers with these benefits.
Gifts that Give Back
Give happily. There are lots of great ways to give and not all of them involve writing a check. Some forms of charitable gifts commit cash and other assets to future philanthropic purposes, while assuring the donor continued income. Yes, you read that correctly. You can continue to earn interest on monies promised to your favorite cause.Life Income Gifts
Consider establishing a life income gift such as charitable gift annuities and remainder trusts. These assets are irrevocably transferred to an organization to be managed for a term of years or until the end of a donor's or beneficiary's life. In exchange for this commitment, you secure annual income for yourself or other beneficiaries, as well as substantial tax and charitable advantages. What's more, with good management and favorable market conditions, the original value of your gift can increase over the term, which means you'll actually be giving a larger gift when the time comes.Charitable Gift Annuities
Charitable gift annuities typically involve transferring cash or property to a charitable organization in exchange for the charity's contractual promise to make fixed annuity payments to the donor (and/or spouse) for life. Payments can begin immediately, or the start date can be delayed to coincide with a particular event, such as retirement. This is a great way to simultaneously generate income and give charitably.Life Insurance Legacy
Naming your favorite charity as beneficiary of a life insurance policy may be a low-cost way to give that can go a long way to minimizing the final tax payable upon your passing.There are a few fairly straight-forward ways you can use a life insurance contract as a form of charitable giving. You can, for example, name an organization as a life insurance beneficiary. This may be a good option for donors whose beneficiaries have preceded them in death or whose beneficiaries are covered by other life insurance contracts or assets. Donors may receive an estate tax deduction for the donated proceeds of the contract, but no tax benefit during their lifetimes.
You can also donate a life insurance contract that has been paid up. Gifts completed more than three years prior to your death are generally not included in your estate for federal estate tax purposes. As a result, your estate may be subject to lower taxes.
Explore More Options
Contact a Thrivent Financial representative to learn about more ways that your charitable donations can be maximized now and into the future.
Thrivent Financial for Lutherans, and its respective associates and employees cannot provide legal, tax or accounting advice or services. Work with your team of professionals, including your Thrivent Financial representative, your attorney and tax professional to determine and implement the appropriate option.
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