Possible Tax Benefits of a Legacy Gift
While we all hope to one day provide for our heirs
through our wills and trusts, did you know that you
can also help Brophy with a Legacy Gift? One of the
reasons to include a charitable bequest in your will
is because you believe in and wish to perpetuate the
mission and values of an organization. You can provide
added financial stability for Brophy and help ensure
a Jesuit education for generations to come, while at
the same time accruing tax benefits for your estate
Here is one scenario:
Let’s say that you own stock that you bought for
$20,000 and it has grown in value to $100,000. The stock
is currently yielding 2%. You would like to sell the
stock in order to invest the money in another asset.
Doing so, however, would mean a sizeable tax bill for
the capital gain on the appreciation.
One solution would be to put the asset into a Charitable
Remainder Unitrust. In this example, after the trust
sells the asset and reinvests the proceeds, the return
is 7% a year. The trust is set up to pay out 5% per
year to you for your lifetime. At the end of your life,
the value in the unitrust goes to Brophy.
Because Brophy is tax-exempt, no capital gains taxes
are paid when the trust sells the asset. Also because
Brophy eventually receives a gift, you receive a charitable
tax deduction the year the unitrust is set up. The following
flow chart quantifies the benefits of this scenario.
There are a number of options for making charitable
gifts to Brophy in your estate plans. Whatever option
you choose, be assured that you will be making a lasting
and deeply meaningful contribution to Brophy College