Ideally, Christian stewardship impacts all phases of our life including our plans for the use of our worldly goods and resources after our death. Planned gifts are extraordinary gifts unlike normal Sunday contributions, capital campaign programs, and special fundraising events. Planned gifts usually involve gifts of assets rather than checks or cash. Some call it charitable estate planning, or deferred giving. Planned giving can offer many benefits:
- It continues the generosity one has shown through life.
- The donor gains a charitable tax deduction now - even for future gifts.
- It can help a donor reduce or avoid capital gains tax.
- It can lower estate taxes.
- It can protect and potentially increase the size of one's estate or one's heirs.
- It could increase one's existing income.
- Finally, it can help one recognize the dream of making the largest contribution of a lifetime, giving a gift that has major impact on a favorite charity.
Many individuals have received stock from companies for whom they worked or have made smart investments in other stocks and securities. Some of these securities have split and/or spun-off into other companies. (For example, ATT was split by a famous anti-trust case to form the "Baby Bells." Some of these Baby Bells have been quite successful, and they themselves have split and had other spin-off companies, creating a great amount of wealth for some stockholders.) Owners of these stocks have been wonderfully blessed, and the IRS is interested in sharing their wealth with them.
One way to avoid paying high capital gains tax is to give the gift of appreciated stock or securities. By doing this, you not only avoid capital gains tax, but you gain a charitable tax deduction for the fair market value of the stocks or securities on the day they were transferred. Plus, your parish, school, agency or the Diocese itself will receive the full value of your stock - a wonderful and thoughtful gift that is a tax-wise move. Because these gifts are "out of the ordinary," you may wish to consider using them towards and endowment of your favorite institution so that your gift can itself keep on giving over the years.
For anyone interested in giving a financial gift, giving appreciated stock can be much more beneficial than selling the stock yourself and then giving the profits from the sale.
Before giving a gift of stock, you or your financial institution should notify the diocese your plans. You can contact Mr. Michael Quilici in the Diocesan Stewardship & Development Office at (775) 326-9432. You need to let the recipient organization or the diocese know the following:
One of life's saddest moments is the death of a love one. Often there is an accompanying tragedy - that the wishes of the deceased may not be carried out due to the lack of a Will, or a valid Will. When one dies without a will, the probate courts have formulas for the distribution of your estate, that are based strictly on marital or blood relatives. Friends, as well as favorite charities, are completely ignored in this estate distribution process.
Each state has different probate policies. Normally all assets from one spouse will be transferred to the other spouse. However, at the death of the last spouse, blood relatives normally become the beneficiaries if there is no will. These two steps have an immediate impact on all families. Families have permanently split over the infighting to control sentimental possessions, mostly because a will did not spell out how these possessions should be distributed.
Another common tragedy occurs when childless couples die. For example, if the husband died first without a will, the probate courts would give all of his assets to his wife. Then, if the wife also dies without a will, all assets go to her relatives - leaving out his entire family. One form of stewardship of your possessions is to indicate where you would like your material possessions in life to go after your death.
Having a valid will makes you feel secure and confident that your intentions will be met. Besides passing your estate to your loved ones in the way you desire, you can also remember your parish, school or favorite charity in your will. There are three ways that you can remember a charity in your will:
- A specific gift amount.
- A percent of your estate.
- The remainder of your estate after you have provided for your heirs and love ones.
The costs associated with setting up one's will vary, depending on the attorney, the complexity of the estate, and the amount of time it takes.
The Diocese of Reno encompasses 28 parishes, 9 missions, 1 high school, 4 elementary schools, 2 pre-school/kindergarten schools and 1 cemetery. Gifts to the Diocese or parishes or agencies of the diocese should be structured in one of the following formats, depending on the type and purpose of the gift:
Gift to the Diocese. Use the following: "The Roman Catholic Bishop of Reno, and his Successors, a Corporation Sole."
An endowment program establishes a fund that remains invested on behalf of a particular organization. The principal amount continues to grow through donations, and is never withdrawn or spent, only invested. The income earned through the investments, however, becomes an on-going source of revenue that increases as the principal in the fund grows.
Just as it is important for a family to save money for things like children's education, emergencies and retirement, it is important for Catholic parishes, high schools, agencies and the Diocese itself to build reserves on which they can depend. Funds generated through an endowment program will always be there ... a perpetual donation for generations to come.
The Diocese of Reno is fortunate to have established an endowment fund into which all endowments are placed. These endowment funds are held in the Catholic Community Foundation of the Diocese of Reno. Financial professionals manage the fund. It combines the endowments of individual parishes, agencies, the high school and the diocese itself in order to maximize investment returns and reduce overhead costs.
The Foundations' assets are segregated from all other assets of the diocese and are used only for donors' specific intentions. The substantial value of the individual accounts allows the endowment funds to be invested efficiently and economically. The foundation has a diversified portfolio that is conservative in nature. The fund is professionally managed by several different fund managers. These professional money managers report to the Investment Committee of the Foundation Board of Advisors. The Foundation fund continues to grow as more parishes, schools and agencies establish endowments to secure their financial future.
The Office of Stewardship & Development will assist each diocesan entity on the planning for and implementation of an endowment program.
TYPES OF ENDOWMENTS
Parishes, schools and agencies continue to establish endowments in the Foundation for their institution's financial future. However, other endowments may be established by individual donors, such as:
Scholarships: Individuals have established scholarships at grade school and high school levels for a variety of reasons:
- As a way to thank the schools which gave them a strong foundation for their future.
- To memorialize students whose lives have ended too early.
- To memorialize one's parents, both living and dead.
- To bless children with a Catholic education.
- To provide for the children of families who otherwise could not afford a Catholic education.
Donor Advisory Funds: An individual family, or organization may establish a donor advisory fund endowment with a substantial gift. Although the Bishop is responsible for the disbursement of earnings from such funds, throughout their lives donors may advise the Bishop regarding the recipients of the earnings disbursements. This allows the donors to establish a special major charitable fund without incorporation of a family foundation. An agreement is also made regarding distribution of earnings after the donor's lifetime.
Some of the benefits of a Donor Advisory Fund include:
- Unlike a foundation, this fund offers privacy and confidentiality.
- Unlike a foundation, there is no need for yearly tax calculations and determinations.
- A full charitable tax deduction can be made for the value of the gift. (The minimum amount for a Donor Advisory Fund is $50,000.)
- If the gift is funded with appreciated securities, capital gains taxes are avoided.
- The donor gets to decide to which charities the earnings should be sent. (Over 50% of the earnings have to benefit a Diocesan entity. All earnings must go to charities whose missions and philosophies follow the teachings of the Catholic Church.)
- Donors decide if they want to remain anonymous to the charity or not.
- A simple Letter of Intent establishes the Donor Advisory Fund, and needs to be approved by the Bishop of Reno.
BENEFITS OF AN ENDOWMENT PROGRAM
Having an endowment program can be a win/win situation for the Donor and to the Diocesan entity.
A Winner for the Donor
- Provides an opportunity for a donor to make a tax-wise planned gift. See benefits of planned giving.
- Offers a new way for a donor to give.
- Gives the donor the satisfaction of knowing his or her gift will continue to be helpful - in perpetuity.
- Allows the donor to experience deep fulfillment, giving his or her a sense of "life value" and "eternal impact" that simply cannot be achieved by any other means.
- Insures that the donor?s wishes will be respected as established in the Endowment Operating Policy.
A Winner for the Diocesan Organization: Provides a new source of revenue for the organization in two ways.