BREAKING NEWS: As of December 18, 2015, for those 70 1/2 or older, you can now transfer up to $100,000 from your IRA to TMS tax free – and have it count against your required minimum distribution. Contact us for more information about this now permanent opportunity available to you.
GIVING TO THE MASTER’S SEMINARY
From gifts of cash, to gifts that are part of your retirement or legacy planning, your participation with us assures that the work here continues. Because The Master’s Seminary is a non-profit ministry, all gifts made to The Master’s Seminary can receive favorable tax treatment from the IRS.
Always consult your tax advisor for the tax treatment of any gift in your individual situation.
SIMPLE – IMMEDIATE IMPACT
- Since cash is the easiest form of giving, it is the most straightforward way to contribute to TMS in the form of our annual fund, a critical need in any fiscal year.
- Alternatively, cash gifts can be directed to our new endowment, The MacArthur Center for Expository Preaching. This new endowment is designed to ensure the financial and doctrinal integrity of The Master’s Seminary in perpetuity.
- Cash gifts can also be combined with other forms of giving (outlined to follow) to increase the impact of your gift.
To Make It Easy:
TMS accepts checks, wired funds, and contributions initiated through credit cards.
Cash gifts provide the maximum charitable income tax deduction available under Federal tax laws. For cash gifts, you can claim a deduction up to 50% of your adjusted gross income, with any excess balance carried forward for up to five years.
MINIMIZE TAX-MAXIMIZE GIFT
Giving appreciated securities such as stocks and bonds can be more tax effective than giving cash.
If you make a gift of securities directly to TMS you will receive an income tax deduction and gift credit to TMS for the full market value of your gift, without paying any capital gains tax on the appreciated valuation.
If you were to sell these securities before making the gift you would have to pay tax on capital gains.
To Make It Easy:
If you own securities in a brokerage account, these shares can easily be electronically transferred to TMS.
In most cases, TMS will promptly sell gifted securities that are publicly traded and apply the cash towards the purpose you designate.
Closely held stock and other securities that are not publicly traded work best when there is a mechanism for TMS to sell the gifted interest to other shareholders or the corporation itself. For these gifts, the donor must obtain an appraisal to claim a tax deduction.
Retirement Plan Assets
AVOID DOUBLE TAXATION
Retirement accounts such as IRA’s, 401(k), and 403(b) plans can be subject to double taxation at your death – ordinary income as well as estate tax, meaning that as much as 60% can go to taxes if simply left to your heirs.
By contrast, retirement plan assets left to TMS at your death will transfer tax free.
In planning your estate, consider leaving TMS your retirement plan assets, and leave more favorably taxed assets to your family.
To Make It Easy:
Most retirement accounts allow the owner to select beneficiaries to receive the plan assets remaining at their death. To designate TMS as a beneficiary, simply contact your plan administrator.
Lifetime withdrawals, even for charitable gifts, are typically treated as taxable (“ordinary”) income. Changes to Federal tax law in any given calendar year may allow for future tax-free distributions when made directly to TMS. Please check with your tax advisor or TMS for up to date information.
Life Income Gifts
MAKE A GIFT AND RECEIVE INCOME FOR LIFE
Gifts of appreciated assets made through Charitable Remainder Unitrusts pay individual (non-charitable) beneficiaries an annualized amount for their lives or a fixed term of up to 20 years. The basis of such payments is an annualized valuation (“unitization”) conducted each calendar year on the investment performance that was achieved in the previous calendar year. When the charitable remainder trust ends, at the end of life or at the fixed term of years, the remaining assets are distributed to TMS.
Charitable Gift Annuities are a second type of life income gift. In exchange for the gifted sum, TMS promises to make lifetime annuity payments to one or two annuitants. At the death of the last annuitant, the balance of the remaining gift will be used by TMS for the purpose you have designated.
To Make It Easy:
With Charitable Remainder Unitrusts, donors can claim an income tax deduction that represents the present value of the eventual gift to TMS. Further, capital gains tax is avoided on the appreciated valuation of the subject asset(s) to form the basis of the trust. Through careful revaluation conducted yearly, capital gains are further avoided or at least minimized.
With Charitable Gift Annuities, payments are generally partly taxable as ordinary income and capital gain, depending upon the gift asset. Further, a portion of that income is usually treated as tax free return of principal, effectively enhancing the annuity income being received.
Gifts of Real Estate
With an outright gift of real property, donors can receive a charitable income tax deduction for the full fair market value of the property and avoid capital gains on any appreciation. An appraisal is usually required to substantiate the tax deduction for most real estate gifts.
RETAINED LIFE ESTATE
Donors can transfer title to their personal residence now, while retaining the right to live in or use it for the rest of their lives or another’s life. While yet living, life tenants are responsible for property taxes, insurance, maintenance, and upkeep. Upon the death of the life tenant(s), title to the property vests in TMS and any subsequent sale proceeds will be applied to the purpose you designate. At the time you initiate a retained life estate you receive an immediate income tax deduction based upon the fair market value of the retained life estate.
Charitable Lead Trust
AN ESTATE PLANNING TOOL – RECOGNIZING
TMS AS WELL AS HEIRS
A Charitable Lead Trust can greatly reduce or eliminate gift or estate tax on trust assets passing to family members.
A Charitable Lead Trust makes annual payments to TMS for a period of time set by the donor, then distributes the remaining assets to the donor’s family or other named beneficiaries.
A Charitable Lead Trust provides a tax advantaged method of supporting TMS for a set number of years, with a potentially significant future tax free distribution to family and other heirs.
NOTE: A Charitable Lead Trust is complex in nature and must be carefully reviewed by the donor’s advisors to ensure that it is compatible with their entire estate plan.
Life insurance allows donors to leverage their resources while providing a potentially extraordinary gift to TMS.
You can donate your existing policy by making TMS the owner and receive an income tax deduction for the value of the policy.
To Make It Easy:
You can maintain ownership of your policy, but name TMS as a beneficiary. This way you maintain the flexibility to change beneficiaries if your situation changes.
Term policies are the most desirable to TMS. With other policy models TMS and the donor will need to confer on the best design for such a gift.
TMS can be made the sole or partial beneficiary of a donor’s life insurance policy or IRA. You control the amount by simply contacting your life insurance carrier or IRA plan administrator.
Gifts to TMS from your testamentary estate, defined outright or calculated by a percentage of the net estate can assure that God’s faithfulness in your life can be an encouragement to future generations through the work of TMS.
To Make It Easy:
You can complete a change of beneficiary form to name TMS as a beneficiary of your retirement plan, bank account, brokerage account, or life insurance policy.
A bequest might not be received by TMS for many years; consequently, restrictions placed on the use of your gift should be as minimal as possible, providing TMS with maximum flexibility as priorities and programs have changed.