Overview

Bequests

The most common planned giving arrangement is the will bequest. Charitable gifts made by will are 100% tax deductible. As with current gifts, bequests may be designated either as unrestricted – providing the most flexibility – or restricted; that is, designated for a specific purpose.

If you wish to include an unrestricted bequest to ASHRAE in your will, the following language is suggested:

Unrestricted Bequest to ASHRAE
"I give, devise, and bequeath to ASHRAE, Atlanta, GA, ______ percent of all the rest, residue, and remainder of my estate (or _______ dollars, property, securities, etc. described below) wheresoever located to be used to support ASHRAE’s mission in such manner as the ASHRAE Board of Directors thereof may direct."

If you wish to provide scholarships for students in a field or school, here is suggested language for three options:

Scholarships Based on Financial Need

Scholarships Based on Academic Merit

Scholarships With Neither Financial Need nor Academic Merit Specified

Benefits:

• Distribution of estate as intended by donor.
• Avoidance of estate and inheritance taxes.

Charitable Gift Annuities

With this gift option, ASHRAE Foundation and the donor enter into an agreement under which ASHRAE Foundation agrees to pay the donor or other beneficiaries a fixed income for life in exchange for a gift of cash, marketable securities, or approved real estate. The minimum gift for a charitable gift annuity is $5,000. The annuity rate is based on the age of the donor or other beneficiaries. Charitable gift annuities are issued through ASHRAE.

Taxation:

• Portion of the annuity payment initially is tax-free.
• Portion may be taxed as capital gain if funded with appreciated property.
• Balance of the payment is taxed as ordinary income.

Benefits:

• Fixed annual income for life.
• Tax deduction based on the value of the assets and annuity rate.
• Reduced capital gains tax.

Charitable Remainder Trusts

This type of trust is established when you irrevocably transfer money or securities to a trustee who invests the assets to pay an annual lifetime income to you or others chosen by you. At the end of the income beneficiaries' lives, or the term of years, the remaining trust assets are distributed to ASHRAE Foundation. When properly established, these trusts provide federal gift and estate tax savings.

Annuity trusts provide current tax benefits along with the security of a fixed, lifetime income. The agreed upon payments remain unchanged regardless of how the investments perform. ASHRAE Foundation can act as trustee. The minimum amount needed to establish a charitable remainder annuity trust is $50,000.

Taxation: The beneficiary is taxed on income received (ordinary income or capital gain).

Benefits: Tax deduction based on value of assets transferred.

Life Insurance

A planned gift to ASHRAE Foundation may be made through a gift of life insurance. For the gift to be tax deductible, ASHRAE Foundation must be the owner and beneficiary. Policies may be new, have premiums remaining to be paid, or be a fully paid policy that you have owned for years. If premiums remain to be paid on a policy for which ASHRAE Foundation is the owner and beneficiary, the payment will be a deductible contribution. ASHRAE Foundation could also be named as the beneficiary of a policy that it does not own. This provision will not provide any current tax advantages, but the money passing to ASHRAE Foundation at the insured’s death will qualify for the federal estate tax charitable deduction.

Benefits:

• Tax deduction for premiums paid by donor.
• Avoid estate taxes and probate costs.

Retirement Plan

Naming ASHRAE Foundation as the beneficiary of a qualified retirement plan is becoming an increasingly popular way to give. Because of the way qualified plans are taxed, at your death relatively little of the assets in the plan may end up in the hands of family members or beneficiaries. These assets not only are included in your gross estate for federal estate tax purposes, but are also taxed when received by the beneficiaries as income in respect of the decedent.

Funding a charitable gift to ASHRAE Foundation with these assets generates an estate tax charitable deduction. Further, ASHRAE Foundation will not have to pay income tax on the assets when they are received. So, using plan assets for a gift to ASHRAE Foundation and other assets for family members can be beneficial to all.

Charitable Lead Trusts

The unitrust is very similar to the annuity trust, except that the unitrust provides a variable income. Payment is based on a fixed percentage of the net fair market value of the trust assets as valued each year. A variation of this type of unitrust provides an annual income that is the lesser of the trust’s net income or the fixed percentage amount. ASHRAE Foundation can act as trustee. The minimum amount needed is $50,000.

Taxation: The beneficiary is taxed on income received (ordinary income or capital gain).

Benefits:

• Tax deduction based on value of assets transferred.
• Avoidance of capital gains tax.

Heritage Society

If you have decided to include ASHRAE in your estate plans, we would like to show you our appreciation by including you as a member of ASHRAE's honorary society, the Heritage Society.

The Heritage Society was established as a means to recognize those individuals who have included ASHRAE in their estate plan via a bequest, charitable remainder trust, charitable gift annuity or other form of planned gift. A planned gift is often the most effective opportunity to ensure a legacy with ASHRAE. They also provide substantial Federal tax deductions, and certain vehicles can provide a lifetime income to you and your loved ones.

If you are curious about the various estate planning options available through ASHRAE Foundation, please call Margaret Smith at 678-539-1201 or email us at foundation@ashrae.org for more information.