Planned Giving FAQs
- APPRECIATED ASSETS are assets that have a higher market value than their "basis," or value for tax purposes. Such assets could generate a taxable capital gain (either short-term or long-term), if sold by an individual or non-charitable organization at a price higher than their basis.
- ATTORNEYS (also known as lawyers) are licensed by the state to practice law and advise their clients, and to assist the executor, trustee, and guardian of an estate. It is conceivable that each might have their own attorney, but usually one attorney represents all three.
- THE EXECUTOR is the person or institution named in a person's will who carries out the terms of the will. Traditionally, the word has referred to a male, and executrix was the female, but this distinction is rapidly disappearing.
- THE TRUSTEE is the person or institution named by a person making a trust, or the person appointed by the court, to carry out the terms of the trust. Assuming a trust has been set up through a will, when the executor's job is finished, the trustee's job begins.
- A BENEFICIARY is the person and/or organization that receives the benefits (usually assets or income) of the trust.
- A BEQUEST is a gift of property or assets to a beneficiary as defined in a will.
- A CODICIL is a written change or amendment made to a will.
- A GUARDIAN is the person who is appointed by the court to care for the person and/or estate of a minor child or a person deemed incompetent. One can nominate a guardian in a will, and though normally the court will honor that nomination, the court has the right to agree or disagree.
- PROBATE is the legal process of proving a will, appointing an executor, and settling an estate; but by custom, it has come to be understood as the legal process whereby a deceased person's estate is administered and distributed.
- A TRUST is defined as any arrangement where property is to be held and administered by a trustee for the benefit of those for whom the trust was created. Depending on the type and how it is established, a trust may be revocable (changeable) or irrevocable (not changeable).
- A LIVING TRUST is a trust set up to operate during the life (and can operate after the death) of the one setting up the trust. It can be revocable, or in other words, you can change your mind and have some or all of the trust property returned to you during your life. An irrevocable trust cannot be changed except in certain legal circumstances (fraud, unlawful agreements, merger of interests, decision of the court).
- A BYPASS TRUST is set up to avoid or bypass the surviving spouse's estate, which enables each spouse to use the federal estate tax exemption.
- A CHARITABLE REMAINDER TRUST is a trust which is set up to pay a return or fixed annual percentage of 5 percent (or more) of the net fair market value of the assets placed in the trust. The trust assets are valued initially, at the time the property is placed in the trust. The trust assets are never re-valued. The difference with a CHARITABLE REMAINDER UNITRUST is that the trust assets are re-valued each year.
- A CHARITABLE LEAD TRUST is almost the opposite of a charitable remainder trust. During the term or life of the charitable lead trust, an annuity or unitrust income interest is distributed each year to the designated charitable beneficiary and the assets are eventually transferred to the trustor's or grantor's designated non-charitable beneficiary(ies).
- A LIFE INSURANCE TRUST is usually set up for the purpose of excluding the proceeds of life insurance from the insured's and the spouse of the insured's estate for death tax purposes. It is an irrevocable trust.
- TESTAMENTARY TRUST – A will can have a testamentary trust written into it, which is set into motion by the court after the will reaches a certain point of execution, and is used only after the death of the person whose estate it represents.
- JOINT TENANCY is a type of ownership where any two or more persons, related or not, may own property and the property passes to the survivor or survivors on the death of one. This passing is not automatic, as some think, and the procedure for passing will depend on local law. But, this form of ownership does have the advantage of allowing property to pass to the survivor without delays of probate and court administration costs.
- A RETAINED LIFE ESTATE is a gift plan defined by federal tax law, allowing the donation of a personal residence (to include a vacation home) or farm with the donor retaining the right to life enjoyment. A life estate may be retained for one or more lives (passed down through family) or it may be retained for a term of years. All routine expenses – maintenance fees, property taxes, repairs, etc. &ndash are the responsibility of the donor. The donor receives income tax benefits in the year of the gift (the property is irrevocably deeded to the charity) as well as estate tax benefits.
To discuss planned giving options, please contact the Rocky Mountain PBS Planned Giving Office:Patrick C. Schaefer, Major Gifts & Planned Giving Manager
303-620-5706
Amy Corpuz, Philanthropy Assistant
303-620-5690
