Legacy Society & Planned Giving

The simplest and most frequently utilized giving option is to include a bequest provision to Holy Angels in your will. Bequests are an excellent way to provide for Holy Angels without parting with assets during your lifetime.  It is important that the bequest be stated correctly in your will or trust.  Here are some examples of bequest language:

Portion of the Estate:

"I give to the Academy of Holy Angels, located in Richfiled, Minnesota, _______ percent of my estate to be used for the school's general needs and purposes."

Specific Amount:

"I  give to the Academy of Holy Angels, located in Richfield, Minnesota, the sum of $________ to  be used for the schools general needs and purposes.

Specific Property:

"I give to the Academy of Holy Angels, located in Richfield, Minnesota, all of my rights, title and interest in the following described real estate (insert legal description) to be used wherever the need is greatest." 

Residual Estate (after other bequests or designations are named):

"I give to the Academy of Holy Angels, located in Richfield, Minnesota, the rest and residue of my estate to be used wherever the need is greatest."

Assets that make effective bequests or planned gifts:

• Appreciated Securities
• IRA's or other Qualified Required Plans
• Insurance
• Real Estate
• Cash

Making a gift of your life insurance is a wonderful way to increase the impact of your philanthropy.  Donating a life insurance policy will not decrease your current income or affect your financial status, and because its value increases as your policy matures over a term of years, you may be able to make a much larger gift to the Academy of Holy Angels than you would during your lifetime. 

There are several ways an individual can use life insurance as the basis for a charitable gift, and each is accompanied by varying income and estate tax deductions allowed to the donor.  For example, you may wish to sign over your life insurance policy to the Academy of Holy Angels, in which case you would continue to pay your monthly premiums and, upon your death, the full face value amount of your policy is contributed to AHA as a charitable gift.  Using this method, the donor benefits from both an income tax deduction based on the premium payments and earns an estate tax deduction equal to the value of the policy.

Another option is to designate the Academy of Holy Angels as the beneficiary (or contingent beneficiary) of your life insurance policy.  In choosing this method, you retain lifetime ownership of this policy, therefore retaining the right to cash it in, borrow against it, and change the beneficiary.  Because you retain ownership of the policy, you will not receive an income tax charitable deduction for this (future) gift or for your premium payments during your lifetime.  However, the policy's proceeds will be included in your gross estate, thus your estate is allowed an estate tax charitable deduction.

Alternatively, the Academy of Holy Angels can benefit from your life insurance policy through the "wealth replacement" concept.  Using this method, you would need to make a current gift to AHA, therefore receiving a charitable tax deduction.  At the same time, you would purchase a life insurance policy to replace either the donated amount or the amount after estate tax that the policy’s beneficiary would have received.  The advantage to the donor is that, depending on the circumstances, the charitable tax savings and any life income resulting from the gift may defray the cost of the wealth replacement insurance premiums.

This type of gift can provide a lifetime of interest income that will be comparable to and often greater than what might be possible with other income-generating investments.  There are two broad gifting options that can be tailored to your specific circumstances.

Charitable Gift Annuity:

A Charitable Gift Annuity is a contract between you and the Academy of Holy Angels. The school agrees to pay a predetermined amount to you and/or your beneficiaries on a regular basis (quarterly, semi-annually, or annually) for life, in exchange for assets which you transfer to the Academy of Holy Angels.

Here is one example of a Charitable Gift Annuity: 

Mr. Smith, age 70, bought stock several years ago for $10,000.  Today, that stock is worth $100,000 and yields three percent.  To receive a higher return to the Academy of Holy Angels, Mr. Smith transfers the stock to the school and establishes a charitable gift annuity.  Based on his age, he receives an income tax deduction of $39,518 in the year of the gift.  He also more than doubles his return from three to six and a half percent.  He will receive $6,500 every year for the rest of his life.

Charitable Remainder Trust:

A Charitable Remainder Trust is an irrevocable trust which provides payments to you and/or other beneficiaries, with the remainder going to the Academy of Holy Angels after a period of time or the lives of the beneficiaries.  These trusts provide numerous advantages, including:

• An income tax deduction in the year the trust is established.

• A source of cash flow for the life of the donor or other loved ones.

• Valuable estate tax benefits.

Here is one example of a Charitable Remainder Trust:

Mr. and Mrs. Smith, ages 70 and 72, establish a five percent charitable remainder trust with an appreciated asset worth $250,000 that they purchased for $50,000.  They receive an immediate income tax deduction of $109,410 (based on their age and payout rate when the trust is established).  They receive an annual payment equal to five percent of the value of the assets inside the trust.

Of course, the Academy of Holy Angels can work with your financial advisors to determine the best planned gift option for you and your family.

Leaving your retirement plan or IRA to the Academy of Holy Angels is a tax-wise gift and an excellent source of assets to fund bequests.  By naming the Academy of Holy Angels as the recipient of your retirement plan after your lifetime (or as a contingent beneficiary after the death of your spouse and/or dependants), you are able to avoid all estate and income taxes on those assets, therefore passing the funds to the Academy of Holy Angels tax-free. 

Under current tax-law, distributions from qualified retirement plans generally must be reported by the recipient as taxable income.  Additionally, in some cases, the balance may be subject to heavy estate taxes, leaving less than 30 percent of the original assets to the recipient.  As the beneficiary of your retirement plan, the Academy of Holy Angels would have the advantage of utilizing 100 percent of the plan's balance, since the apportionment would avert both income and estate taxes.

If you would like your spouse or children to remain beneficiaries of your retirement plan, you still have the option to include the Academy of Holy Angels as a beneficiary of a specified portion of your assets.  Upon your death, the plan's administrator can allocate the said portion of that account to the Academy of Holy Angels without affecting your family's share.