Re: Soka Gakkai International -- SGI
Date: December 31, 2010 02:01AM
SGI Memo: What Is Planned Giving?
Planned Giving is the making of a gift to SGI-USA by including SGI-USA as a beneficiary in a provision of your will, estate document, or transfer during life. The gift may be money, real estate, shares of stock, life insurance proceeds, proceeds from pension funds, IRAs or 401(k) plans or other property which can be readily sold. The gifts can take effect either during life or after death.
As the name implies, Planned Giving requires making a plan and thinking clearly about how you want to distribute your assets. Outlined below are several ways you can insure that your desires are carried out. SGI-USA has a national staff of professionals who are available for consultation on a confidential basis.
What Is the Most Common Way to Make a Planned Gift to SGI-USA?
The "bequest in a will" is the most common and easiest way to make a gift to SGI-USA. A bequest is property specified in a will naming a beneficiary (recipient) of the specified property. A "will" is a signed legal document that states the details of the will maker's decisions as to the distribution of his or her property upon death. A will must be written, signed and witnessed according to the law of your State. A will can be changed at any time before death.
Examples of bequests: Long Tom Member has practiced Nichiren Buddhism for twenty years. Although he was broke at the beginning of his practice, he has since accumulated a comfortable amount of assets and job security. Long Tom attributes his change in fortune to changing his attitude towards work and his relationships with others. Following President Ikeda's guidance, he became "indispensable" at his work place. He "created harmonious relations with his colleagues and superiors, using wisdom and discretion along the way." As a result of his practice, he was promoted four times and became the third ranking executive at his company.
With his children grown and he and his wife comfortably set, Long Tom amended his will (a codicil) by making a bequest to SGI-USA, using the services his family lawyer. His bequest reads:
I give, devise and bequeath to the Soka Gakkai International-USA of 606 Wilshire Blvd, Santa Monica, California 90401, a not-for-profit-corporation of California and an exempt religious organization under section 501(c) (3) of the Internal Revenue Code the amount of $xx,xxx (xx,xxx dollars). I further direct that interest or other income that may be earned by said bequest shall also be paid to the Soka Gakkai-USA from the date of my decease until distributed.
Jane Nan Member, Long Tom's wife, is not a Nichiren Buddhist but appreciates his practice because he has gone from an angry man who changed jobs on a regular basis, to a valued, respected executive and loving husband and father. John also was a great help to Jane's father during his final illness. Jane decides to leave (devise) a piece of land she got as a child to SGI-USA. Jane's bequest reads the same as John's except that instead of "$xx,xxx (xx,xxx dollars)" the legal description of the land is used:
"lot 4, block 2 in the Cinder Block subdivision, commonly know as 888 Tarantula Place, assessor's parcel number 7711, all within the City of Nukedville, NV 89111."
I don't have a will but it sounds like a good idea. How do I make a valid will or other estate plan?
1. Make a complete list of all of your property. Include identifying and descriptive information such as account numbers (for bank accounts, IRA and 401K accounts, pension funds, insurance policies), serial numbers of especially valuable items, vehicle identification numbers, legal descriptions of real estate etc. It is a good idea to check the beneficiaries of all your various accounts and policies. Many times a divorced spouse unintentionally remains as the beneficiary. Also check free term life insurance policies offered by banks, credit unions and credit card companies. These are usually in the amounts of $1,000 or $2,000 and remain in effect for as long as your account is current.
2. Consider how you want your assets distributed either during life or after death. A will or other estate document is a declaration of your values in life, of your relationships and loyalties. For example, a life partner who is not married to you will get nothing without your valid will. Your family may decide you need a good Baptist funeral and burial. Your pets will probably be destroyed if you do not make arrangements for them and set aside funding for their care. A will is one way to insure you accomplish your wishes. There are several others, such as trusts, that might be appropriate for a person in your circumstances.
3. Talk with your lawyer about drafting a will or trust document. If your lawyer does not practice estate planning, have him refer you to one that does. If you do not have a lawyer, ask your friends for recommendations. Please remember, your lawyer works only for you. His or her job is to advise you and to draft the appropriate documents to effectively carry out your intentions. A good lawyer will save you and your beneficiaries money, time and aggravation.
4. Do-it-yourself will and trust documents are not quite as bad as do-it-yourself dentistry, but almost. In many areas, a lawyer will advise you and draft a will for about $100-$200. A do-it-yourself will or trust kit will cost between $10 and $20. If you make every optimal decision and do everything right, which is doubtful, you might save $150, the cost detailing your car or a case of cheap wine.
Is There a Simple Way of Making a Gift to SGI-USA Using Life Insurance?
Yes. You can name SGI-USA as the beneficiary of a new or existing policy. For an existing policy , ask your insurance agent how to change the beneficiary of a policy . This usually involves filling out a form and submitting to your company. Upon death, SGI-USA receives the proceeds from the policy. For a new policy, simply make SGI-USA a beneficiary or partial beneficiary.
There are two basic types of Insurance: "whole life" and "term." Insurance policies are contracts between the insurance company, "insurer," and the policy owner or "insured."
In a "term" policy, the owner pays a relatively small amount of premium for a large amount of coverage. If the owner stops paying the premium, the policy is cancelled. Nothing is due the owner from the insurance company. Depending on the wording of a term policy, the policy may or may not be cancelable by the insurance company. As the owner grows older, the premiums go up.
In a whole life policy, the owner of the policy pays a higher premium and creates a "cash surrender value" for the policy. Generally, the insurance company may not cancel whole life policies. Eventually, the whole life policy will be "paid up" meaning that no more premium payments are due, yet the face amount of the insurance is paid the beneficiary upon death of the insured.
Whole life policies upon which premiums have been paid for a number of years may still have value to the owner, even if the owner stopped making premium payments.
You can make a gift of a "paid up" or partially paid up whole life policy to SGI-USA by transferring the ownership of the policy. Since this gift is made during life, it qualifies for an income tax deduction.
Is there a way of making a gift to SGI-USA during my lifetime and maybe save on income taxes?
Yes. Because SGI USA is a tax-exempt organization under section 501 (c) (3), your gifts generate an income tax deduction. The specific amount of your deduction is governed by the tax code and depends on the type of gift you make. If you are interested in these options or other options that may be available, please talk to our National Planned Giving Staff.
Here are examples of gifts made during life.
Gift Annuity Agreements -- The donor transfers cash, securities or property to SGI-USA now and SGI-USA agrees by contract to pay the donor a fixed income for life. This annuity is qualified for an income tax deduction. In addition, part of the annual income paid to you by SGI-USA also qualifies for an income tax deduction.
Life Estate Agreements -- The donor transfers a farm or residence to SGI-USA now and reserves a life estate for the donor and the donor's spouse. The donor and the donor's spouse continue to have full enjoyment of the property for the life. The value of the real estate qualifies for a current income tax deduction.
Sale of Real Estate to SGI-USA at Less-than-fair Market Value -- The donor sells real estate at less than fair market value to SGI-USA. Generally, the donor receives an income tax deduction for difference between the fair market value and the sale price.