AG Financial Solutions

Planned Giving is a process that integrates the personal, financial, and estate planning goals of donors with their desire to create current or future financial gifts for charitable purposes. Some planned gift options, like Bequests, are very straightforward and are made by a designation in a Will or Trust. Others, like Charitable Gift Annuities, require additional planning and are designed to create present or future income streams for the donor or other beneficiaries, tax savings for the donor, and a legacy gift for the charity.

The IRS sets out a series of actuarial factors and calculations that we follow to determine your income tax charitable deduction. Where an individual has retained the right to receive income from a charitable gift, the amount of the deduction is reduced by the actuarial value of that income stream plus distributed capital gains generated by the trust.

Irrevocable means the document or agreement cannot be revoked or changed.

Revocable means that the agreement or document can be changed, terminated or revoked.

A trust, in its simplest terms, is a holding tank for assets that has a legal name for titling purposes. By taking the assets out of the name of an individual and retitling them in the name of a trust, you neutralize the need for probate of the assets in the trust’s name after you die because that property no longer has a human owner who can die. Instead, the trust has a trustee, often the person who creates the trust and transfers assets to it, and successor trustees, all who are tasked by the language in the trust to manage and later distribute the property in some fashion. The trustee and successor trustees manage the property over time and then, when distributing the property under the terms of the trust, do the work that a probate court would do in retitling property in the name of the ultimate recipients of the assets. As such, a trust is very different from a Last Will and Testament because one of its primary functions is to avoid the probate process completely.

One form of a trust is called a “revocable living trust” because it is created while the property owner is living and put into place to operate and hold assets during their life. During which time, the document may be amended or revoked, all for the sake of handling the property on their behalf during any period of disability and avoiding probate with the assets named in the trust after they die. For some people, a trust can make sense because they have complex assets that are difficult to transfer properly using the other non-probate methods or because they like the idea of a trustee managing their assets for them during any period of disability in the future. Whether or not a trust is a good fit should be a decision based on your personal preferences of how you like to hold and manage your assets as well as what types of assets you own. This decision needs to be made in consultation with your third-party attorney who has experience working extensively with both wills and trusts.

A trust can also become irrevocable over time to create certainty as to the ultimate beneficiaries and distribution plan of the trust. Also, some trusts are made irrevocable from the start, usually to create a specific tax benefit allowed by the Internal Revenue Service.

A Stewardship Trust is a revocable living trust with basic requirements that you name the Assemblies of God Foundation as trustee and include a gift of at least ten percent (10%) of your estate to an Assemblies of God church or ministry upon your death. Distribution plans under a Stewardship Trust are flexible and customizable and may even include estate tax planning provisions.

A Donor Advised Fund is a flexible giving device that can accept tax-deductible charitable contributions and then distribute funds to charitable 501(c)(3) organizations. Assemblies of God Foundation acts as custodian of the donor advised fund and distributes income and/or principal with the advice of named advisors to the fund. Individuals, couples families and organizations can use a donor advised fund to create an immediate charitable tax deduction while creating a pool of funds to be given away immediately, over time, or someday in the future. A Donor Advised Fund should be considered by those who are interested in avoiding the regulations and complexities surrounding private foundations. A Donor Advised Fund can also be designed to act as the charitable recipient of distributions from revocable or tax-beneficial irrevocable charitable trusts.

A Charitable Remainder Trust is an irrevocable trust designed to receive property, whether it be cash, securities, appreciated real estate, or other marketable assets, and then convert that property into an income payment that can continue through the life of the Donor(s) and up to twenty (20) years to third parties. The funding of the trust creates an immediate charitable tax deduction, and property sold through the trust avoids imposition of upfront capital gains. During the term of the trust, income payments are payable to named parties in either fixed or annually adjustable amounts, and upon the termination of the trust’s term, the remainder of the trust principal is transferred to a named charity or donor advised fund. A Charitable Remainder Trust is an excellent alternative to an outright sale of appreciated securities, real estate or other marketable assets due to its charitable and capital gain tax benefits, but it can also be funded with cash to achieve a charitable tax deduction.

A Charitable Gift Annuity is a contract wherein an individual or couple transfers cash or securities to the Assemblies of God Foundation in exchange for a promise to pay the donor(s) for the rest of their lives. Payments and rates are calculated based on the life expectancy of the donor(s). They are typically most beneficial to seniors who want certainty and stability in their income stream. Creation of a charitable gift annuity creates an immediate charitable tax deduction for the donor(s), and payments are backed by the issuing entity. Upon the death of the donor(s), any remaining amount is distributed to the Assemblies of God Foundation and other charitable organizations chosen by the donor(s). Charitable gift annuities are available in most states, but there are a few exceptions.

The Assemblies of God Foundation has a significant number of planned giving options that complement the investment, insurance, and retirement options available from AG Financial Solutions. Form based wills, revocable trusts, charitable remainder trusts, charitable gift annuities, endowments, and donor advised funds are a few of the available tools, as well as the ability to act as professional trustee under many circumstances. The Assemblies of God Foundation serves a broad set of individuals, churches, ministries and institutions in fulfilling their planned giving needs.