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Giving
Giving at the end of the year allows the Christian giver to express
gratitude and love for the financial and spiritual blessings experienced
during the year. The spiritual value of year-end giving is often overlooked,
and yet is one of the most important factors in Christian stewardship.
Giving thanks to God for all He has done for us should motivate us to give
all that we can. Proverbs 3:9(a)(NAS) says to "Honor the Lord from your
wealth".
Here are some ways that you as a Christian may honor the Lord as you
give your wealth.
Gifts of Cash
Charitable gifts are often made by cash or check. - If you itemize
your deductions, gifts of cash may be deducted up to 50% of adjusted gross
income. - If you want to take a deduction on April 15 for this year's
taxes, the gift must be completed by December 31.
Deductions may be taken in the year of the gift and may be spread over
five more years. Since tax rates are decreasing over the next several
years, making a gift this year gives the best deduction.
Stock
Appreciated Stock -Give the Stock to the church and let the
church sell it. You by-pass capital gains taxes and you get a charitable
deduction for the full value of the stock. The stock must be owned
by you for a year and a day. Depreciated Stock- You sell the
stock and give the proceeds to the church. You may take a loss and
take a charitable deduction for a cash gift of the proceeds. NOTE:
If you own $10,000 in appreciated securities and have $10,000 in cash,
you should give the $10,000 in appreciated stock to the church, then use
the $10,000 cash to replace the stock given. This gives you a stepped-up
basis.
GIFTS OF REAL ESTATE
You Must Have owned property for one year and a day. - Your deduction
is based on the fair market value of the real property. You must
obtain a qualified appraisal. Your tax advantages are the same as
for appreciated and depreciated stock.
Gifts of Life Insurance
You may assign your annual dividends to the church/WCIF. You
may use the
annual dividends to purchase a new policy for the church and make the
church the irrevocable owner and beneficiary. - Give a paid-up policy that
you already own. You can deduct an amount equal to the approximate
cash value up to 50% of adjusted gross income. - Name the church
as a primary or contingent beneficiary of a policy you already own.
Retirement Assets
If you are over 59 ½ and have tax-deferred retirement accounts,
you may wish to make withdrawals sufficient to fund your charitable
gift. - You will report the income on your tax return
and take a corresponding deduction for your gift.
Charitable Remainder Trust (CRT)
A Charitable Remainder Trust provides substantial tax savings and provides
an annual income to the donor. If funded with appreciated assets,
you may by-pass capital gains taxes and may increase your income when the
asset is sold and reinvested to produce an income for the beneficiaries.
Upon the death of all
beneficiaries, the remaining assets are distributed to the church.
Gift Annuity
A Gift Annuity allows a person to make a gift of cash or securities
and retain the right to receive income from the gift. - The
payout rate is based upon the beneficiary's age(s). You receive a
tax deduction and a portion of the income is returned as tax-free principal.
If the annuity is funded with appreciated assets, capital gains may be
deferred. At the death of the beneficiaries, the church receives the remaining
principal.
NOTE: Tax laws are subject to change.
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