Bequests by will
After providing for your loved ones, leaving a bequest to the Idaho Community Foundation can be one of the simplest ways to achieve your charitable goals. You may choose to create a new fund through a will or name an existing ICF fund as a charitable beneficiary.
A fund created through a will can benefit one or more specific organizations, an area of interest (the arts, environment, education, etc.), or a specific community or region. Other funds might provide scholarships or offer flexibility to meet the changing needs of Idaho.
A charitable bequest provides you flexibility since it may be changed at any time. You retain ownership of your assets during your lifetime, but can make a significant charitable contribution to the community after your death. Furthermore, your taxable estate will receive a charitable deduction equal to the full, fair market value of the bequest.
Types of Bequests
- General bequest: You simply leave a specified dollar amount (e.g. $100,000) to ICF.
- Specific bequest: A bequest of this type involves the designation of specific property (e.g., a home, a farm, shares of stock, etc.) to ICF.
- Residuary bequest: Through a residuary bequest ICF receives all (or a portion of) your estate after all debts, taxes, expenses and other bequests have been paid. It may augment a general or specific bequest to ICF if the size of the estate allows, or may ensure that other beneficiaries receive their bequests prior to distribution to ICF.
- Percentage bequest: You may direct ICF receive a percentage of the estate or residuary estate. Through a percentage bequest, if the size of the estate changes, the bequest will change proportionately.
- Contingent bequest: In the event an individual beneficiary dies before you or disclaims the property, you can name ICF as the contingent beneficiary.
Click HERE to learn more about planned giving options. (link to Planned Giving Options page in the Plan section.)
Qualified Retirement Plans
Most retirement plans, including 401(k)s and IRAs, are income tax-deferred, meaning the income tax is not paid until the funds are distributed to you in life, or upon your death. This taxation makes retirement assets among the most costly assets to distribute to loved ones.
As a tax-exempt organization, ICF makes a great beneficiary of retirement assets because it is eligible to receive the full amount and bypass any income taxes. On the other hand, gifting such assets to your heirs could cost as much as 35 percent. That means an IRA worth $100,000 could only be $65,000 by the time it makes it to your heirs.
To name the Idaho Community Foundation as the beneficiary of your retirement plan, contact the plan administrator for the IRA or tax-deferred retirement account and request a change of beneficiary form. List the Idaho Community Foundation (EIN: 82-0425063) and the percentage of the plan’s value (0-100%) you would like us to receive on the beneficiary form. Return the form to your plan administrator.
Click Here to contact ICF staff about gifts of retirement assets.
Life Insurance Policies
Life insurance policies are an excellent vehicle for charitable gifts, often enabling donors to achieve family and charitable goals simultaneously. People purchase life insurance to provide financial protection for their family, business or estate. Later in life, donors may find that they do not require as much insurance and may find it desirable to use insurance policies for charitable giving.
Below are several ways to make gifts of life insurance:
Name the Idaho Community Foundation as the designated beneficiary of your policy (revocable). One of the rights you have as an owner of a life insurance policy is to decide who receives the proceeds when you die. Frequently, policies name a spouse, children, parents, relatives, or friends as the beneficiaries. However, it is also possible to name one or more nonprofits, such as the Idaho Community Foundation as a beneficiary.
You retain ownership of the policy and have access to the cash value as well as the right to change the beneficiary. For as long as you retain ownership of the policy, there is no charitable deduction for the value of the policy or for subsequent insurance premiums. However, proceeds payable to the Foundation at your death will not be subject to federal estate taxes.
How It Works
Contact your insurance company for its change of beneficiary form for the life insurance policy. List the Idaho Community Foundation (EIN: 82-0425063) and the percentage of the policy’s value (0-100%) you would like us to receive on the beneficiary form. Return the form to your insurance company.
Gift a paid-up policy to the Idaho Community Foundation by transferring ownership and naming ICF as the beneficiary (irrevocable). If you have a life insurance policy that requires no additional premium payments – a “paid-up” policy – it can be donated to ICF. By irrevocably assigning ownership of the policy to a qualified nonprofit, you have made a completed charitable gift. Since the policy no longer belongs to you, you can take a charitable tax deduction equal to the lesser of the replacement value of the policy or your cost basis in the policy.
How It Works
Contact your insurance company for its assignment of ownership form. List the Idaho Community Foundation (EIN: 82-0425063) and the percentage of the policy’s value (0-100%) you would like us to receive on the form. Return the form to your insurance company, and send a copy of that form and the policy to ICF. Please include a cover letter explaining that you are making a gift of the policy.
Gift a new policy or other policy that requires additional premium payments to the Idaho Community Foundation by transferring ownership and naming ICF as the beneficiary (irrevocable). If the policy you give irrevocably to ICF still requires regular premium payments, the charitable deduction is generally equal to the lesser of the “interpolated terminal reserve” and the cost basis in the policy. The interpolated reserve is an amount slightly larger than the cash surrender value of the policy, plus a portion of the last premium paid before the gift was irrevocably made. If you continue to pay the premiums after ICF owns the policy, your payments qualify as gifts of cash to ICF.
How It Works
To make a gift of a new policy, arrange with your insurance company to purchase the policy and make the first premium payment yourself. Then assign the policy to ICF using the assignment of ownership form. As noted, future premium payments can be made as gifts each year to ICF.
Click Here to contact ICF staff about gifts of life insurance.
Charitable Gift Annuities
With a charitable gift annuity, you receive a fixed stream of income for life. Through a simple contract, you agree to make a donation of cash, stocks or other assets to the Foundation. In exchange, we agree to pay one or two individuals (annuitants) fixed quarterly payments for the remainder of their lives. After the passing of the last annuitant, the remaining principal is transferred to a new or existing ICF fund to accomplish your specific charitable goals.
Below are some of the benefits of establishing a charitable gift annuity:
- Your initial gift is partially income tax-deductible.
- Your charitable gift annuity payments are partially income tax-free.
- Annuity payments are fixed, and not affected by the ups and downs of the economy.
- Your annuity can benefit one or two people, including yourself or your heirs.
- If you use appreciated stock to make a gift, you can usually eliminate capital gains tax on a portion of the gift and spread the rest of the gain over your life expectancy.
ICF currently administers charitable gift annuities for donors interested in making gifts of at least $50,000. Annuity payments are determined based on the value of the contribution, the number of annuitants, and the ages of the annuitants and reflect the rates recommended by the American Council on Gift Annuities. As long as the minimum age for distribution requirement is met (age 60) at the time distributions begin, you may choose to receive the payments immediately, or defer them to a later date, usually after retirement.
Click Here to contact ICF staff about establishing a charitable gift annuity.
Charitable Lead Trust
Donors that have established a charitable lead trust with the assistance of their attorney or professional advisor may name an ICF fund as the beneficiary. The trust makes payments to the ICF fund for the charitable purposes you specify. After a set number of years, the trust’s remaining principal and any accumulated appreciation can be distributed to children, grandchildren or other named beneficiaries, often with significant estate tax savings.
Click Here for more information on charitable lead trusts.
Charitable Remainder Trusts
Donors that have established a charitable remainder trust with the assistance of their attorney or professional advisor may name an ICF fund as the beneficiary. The trust makes payments to the donor others for life or a certain number of years (not to exceed 20). After the passing of the last beneficiary, the remainder is contributed to an existing ICF fund or to be used to create a new fund.
Click Here for more information on charitable remainder trusts.