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Meet your financial goals and make a lasting impact for children in crisis with our Planned Giving options.
You can make your gift to our general fund, which allows Covenant House flexibility in applying the gift where it will have the greatest impact now and in coming years, or you can target your planned gift to any Covenant House Georgia program.
Our Planned Giving program provides information and assistance for our donors, as well as the careful administration of your planned gift.
To help you get started right now, here are a few of the ways you can invest in the future of Covenant House and the young people we serve:
Naming Covenant House as the beneficiary of your retirement account, insurance policy, bank account or DAF is a simple way to leave a legacy of love for homeless kids.
Beneficiary designations are a popular way of making a legacy gift that will benefit homeless kids in the years to come.
Designating a beneficiary of a financial account is easy to do. In most cases, Beneficiary designations can be created or changed by simply signing a form provided by the account administrator. Often, a beneficiary can be changed online. A beneficiary can be changed again at any time if you change your mind. No lawyer is required. Beneficiary designations also allow assets to pass outside the probate process, which may reduce costs and the potential for contests.
Designating a charity such as Covenant House as the beneficiary of all or a portion of one of your financial accounts can represent one of the best sources of charitable giving in your estate.
Funds from retirement accounts are among the most highly taxed estate assets. For this reason, IRAs, 401(k)s, 403(b)s, Keough Plans, SEP IRAs and other retirement plans make great opportunities for charitable beneficiary designations.
Unlike most other assets, retirement accounts do not receive a ‘basis step up’ on the account appreciation at the time of death. Your heirs will have to pay tax at ordinary income tax rates on distributions they receive from inherited IRAs. Because Covenant House is a tax-exempt organization, IRA distributions received by Covenant House are not subject to income tax. Designating Covenant House as a beneficiary of your IRA or other retirement plans can mean that those funds will be used to establish your legacy of caring for our kids without being reduced by income tax.
Many different types of accounts such as bank accounts (either checking or savings), donor-advised funds & mutual fund and brokerage accounts can have ‘payable on death’ or ‘transfer on death’ Beneficiary designations.
Life insurance can also provide an opportunity for a charitable beneficiary designation. After many years, the original need that prompted the purchase of a life insurance policy may have passed, making the policy proceeds an asset that can be used for charitable giving.
Covenant House International does not provide tax, legal or accounting advice. This material has been prepared for information purposes only, and is not intended to provide, and should not be relied on for tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors for such advice.
A bequest is a gift by will or revocable living trust. This is an excellent choice if you want to support Covenant House in the future, but wish to maintain liquidity and use of your assets during your lifetime.
For a homeless kid without a family, there is no such thing as an inheritance... no nest egg passed from generation to generation. But through your legacy, our kids will know that someone remembered them... and did plan for their future by funding programs that will keep them off the streets for good.
Making a gift through your will is an excellent choice if you want to have a lasting impact on the lives of homeless kids long after you are gone but wish to maintain liquidity and use of your assets during your lifetime. And the full amount of your gift is deductible from your taxable estate.
A bequest can be unrestricted, enabling Covenant House to direct your funds where future need is greatest, or restricted to a particular program or Covenant House location.
Example of unrestricted bequest language:
I give (insert dollar amount, property to be given, percentage of the estate, or "the remainder of my estate") to Covenant House Georgia, a nonprofit corporation, Taxpayer Identification Number 13-3523561, headquartered at 1559 Johnson Road NW, Atlanta, GA 30318, for its general use and purposes.
Example of restricted bequest language:
I give (insert dollar amount, property to be given, percentage of the estate, or "the remainder of my estate") to Covenant House Georgia, a nonprofit corporation, Taxpayer Identification Number 13-3523561, headquartered at 1559 Johnson Road NW, Atlanta, GA 30318, and it is to be used specifically for [insert designated program or location].
If you include Covenant House Georgia and our kids in your will, please let us know so that we can thank you appropriately.
Transfer assets to Covenant House - often cash or stocks. A Covenant House charitable gift annuity can provide you with tax savings, immediate income, and ensure homeless kids have a chance at a better life.
The Covenant House charitable gift annuity enables you to transfer cash or marketable securities to Covenant House in exchange for an immediate income tax deduction (the year you make your gift) and guaranteed fixed payments to you for life. But most important, your Covenant House charitable gift annuity gives our kids a chance for a better life.
To further assist you, below is a detailed explanation of the benefits of a Covenant House charitable gift annuity. Prospective donors are also urged to seek the advice of a qualified tax advisor before entering into a Covenant House charitable gift annuity.
The Covenant House charitable gift annuity guarantees quarterly payments for life to you or a person you designate, beginning immediately. The rate is generous and based on your age on the gift date. Nominal rates may be lower than those available from commercial insurance companies.
A substantial portion of each annuity payment is tax-free over the life expectancy of the donor because it is considered a return of the gift principal. After the life expectancy of the donor, the entire annuity becomes taxable.
Gifts of appreciated securities provide more benefits. Both the annuity amount and the income tax deduction are based on the full value of the gift. No capital gains tax on the appreciation will be due at the time of the gift as long as the donor is an annuitant. For gifts of appreciated securities, the tax-free portion of the annuity payments is reduced.
If you itemize your deductions in the year you make the gift, you will receive an immediate income tax deduction that will usually exceed one-third of the contributed value. The tax deduction will be greater if you choose a lower annuity rate. IRS regulations limit charitable deductions to 50% of your adjusted gross income (AGI) for cash gifts (30% of AGI for stock gifts) in any year. Any unused deduction can be carried forward for five additional years.
The minimum gift for a Covenant House charitable gift annuity is an affordable $5,000, with no maximum on the amount you can contribute.
A Covenant House charitable gift annuity can be established with either cash or securities.
After the annuity payments have ended, your gift will be used to help the kids at Covenant House. Prospective donors are urged to seek the advice of a qualified tax advisor before entering into a Covenant House charitable gift annuity.
A charitable remainder trust can meet your unique investment and giving goals with flexible, individual planning, funding and administering.
Of all the ways to provide support to Covenant House, the most sophisticated may be a charitable remainder trust, which can be tailored to meet the widest range of investment needs and charitable giving goals.
Each trust is individually planned, funded and administered. This individual handling allows the greatest flexibility in the assets used to fund the gift, the type and duration of income and the ultimate use of the gift by Covenant House. A charitable remainder trust is a personalized, meaningful contribution.
To help you get started, we have provided the following information to help you decide if a charitable remainder trust is right for you:
Charitable remainder trusts provide income for life to you or someone you designate, after which the trust remainder will go to fund Covenant House's lifesaving programs. But unlike the simpler charitable gift annuity, the payments from a charitable remainder trust can be customized to your needs:
Cash or publicly traded stock can be used to establish a charitable remainder trust, as can developed or undeveloped real estate, all or part of a principal residence, shares of a closely held corporation, tax-exempt bonds, IRA leftovers or even artwork. Virtually any substantial asset that has appreciated in value can be used to good advantage to fund a charitable remainder trust, thereby avoiding capital gains tax.
Charitable remainder trusts usually provide taxable income with the widest range of payment options to the income recipient. Fixed payments or variable payments designed to grow over the years are among the options. And in special cases, charitable remainder trusts may provide mostly tax-free income to a donor.
Covenant House's charitable remainder trusts receive high-quality administration at no cost to you or to the trust. Low-cost, high-quality asset allocation and investment selection are obtained through the Vanguard Group of mutual funds, with independent evaluation through Morningstar Mutual Fund Service. You can choose from among a wide variety of highly rated, low-cost Vanguard funds for the investment of your trust, or you can leave the investment choice to our Finance Committee.
Two types of charitable remainder trusts are allowed by law: the unitrust and the annuity trust. They are fundamentally the same except for one significant difference: the way the amount paid to the income beneficiaries is calculated each year.
The annuity trust provides fixed payments of the same amount each year. The amount is set on the date of the gift. The annuity trust is attractive in situations where the trust will exist for a relatively short period of time. In these cases, the predictability of the fixed payments is more important than is the eroding effect of inflation over the years.
Unitrust payments will vary from year to year. The amount of payment in any one year is based on the value of the assets in the trust on January 1 of that year. Each January 1, the assets are revalued and multiplied by the percentage payment rate stated in the trust agreement to determine the "unitrust amount" for that year. This unitrust amount provides great flexibility to the unitrust. A lower-percentage-rate unitrust will tend to grow faster over the years, providing increasing payments to the donor in the years ahead. The opportunity for growth is the reason a unitrust is often the recommended type of charitable remainder trust for a donor under age 65. The growth opportunity is enhanced because the trust assets compound tax-free.
A unique feature of the unitrust is that it can accept additional gifts. This feature is useful in order to create a retirement buildup unitrust, where additions each year build up a substantial retirement income stream.
A special case of the unitrust is called a net income unitrust. In this case, the recipient receives the lesser of the unitrust amount or the actual income earned by the trust investments. This can be useful in the case of a retirement buildup unitrust, where the retirement income is to be deferred for several years, or in the case of a trust being funded with an illiquid asset such as unimproved real estate.
The great flexibility of a unitrust allows a donor to secure very interesting benefits. You can use appreciated stock compounded tax-free to pay future college tuition of grandchildren, plus take a substantial income tax deduction in the year of your gift. This is one of many opportunities. Please call or email us to discuss your particular situation.
Wealth replacement trust
A popular charitable giving plan often proposed by financial planners, the wealth replacement trust combines a charitable remainder trust with a life insurance trust to make a substantial charitable gift at a reduced cost to your heirs. It works by using the tax and income benefits from the charitable remainder trust to purchase life insurance that ultimately replaces the charitable remainder trust assets for the benefit of your heirs. By using an insurance trust, gift or estate tax is minimized or avoided, the cost of your gift to your heirs is reduced and you have made a significant contribution to Covenant House.
Retirement buildup unitrust
This trust is often used by donors in their late 40s and early 50s to enhance their retirement income stream. Through a combination of deferring income until retirement, tax-free compounding and annual contributions of appreciated securities, a charitable remainder unitrust can become a substantial part of a retirement plan.
Term-of-years annuity trust
An annuity trust can be used to provide a fixed payment stream for a set number of years. The appreciated assets from these trusts have been used to provide college tuition for grandchildren. A rate can be set higher than would be allowed for lifetime payments. This type of trust has also been used to maximize the payment rate and charitable deduction when a terminal illness indicates you may not live to your normal life expectancy.
IRA leftovers testamentary charitable remainder trust
The amount of your IRA that remains after your death is an asset that may be subject to very heavy taxation. It can be subject to both estate tax and income tax payable by the ultimate recipient. Charitable remainder trusts have served a growing role as recipients of these distributions after death. The distributions are received without being reduced by the accrued income tax. Estate tax is offset by an estate tax deduction. The trust assets provide payments to heirs based on the full value of the distribution, after which the remainder passes to Covenant House.
Unitrust to transfer a family business
In a closely held (chapter C) corporation held by older and younger generations of a family, the unitrust can be used to effectively transfer ownership to the younger generation. The older generation contributes company stock to a charitable remainder trust to provide themselves with retirement income, an income tax deduction and capital gains tax relief. When the corporation purchases the older generation's stock from the trust, the percentage ownership of the corporation by the younger generation is increased.
These special applications suggest the broad variety of goals that can be reached with a charitable remainder trust and illustrate how it may be tailored to meet your special needs while still making a tremendous contribution to Covenant House's mission.
Ready to leave a legacy? See below for necessary information needed to make a gift:
Make your gift to Covenant House Georgia,Taxpayer Identification Number 13-3523561, located at 1559 Johnson Road NW, Atlanta, GA 30318
To transfer a gift of stock, contact Heather Karellas at firstname.lastname@example.org.