As a community-based legal practice, we recognize the
benefits that our community receives, directly and indirectly,
from the abundance of non-profit organizations providing
services and programs throughout our region. For many of
us, this is our community of choice, because of the varied
cultural organizations, the high quality medical facilities and
the private school systems that provide greater opportunities
and make life here more meaningful and productive. In
addition, non-profit organizations serve in their own right
as economic engines which provide employment and draw
people to our community. As all these various organizations
flourish, so too do the lives of all of us living here.
There is a price to pay, however, for these benefits that we all
enjoy. To do their work well, funds are needed over and above
the fees collected and government supports received. They
need our collective help and our financial support in order
to continue to provide quality services to our community.
As a beneficiary of these services, I urge you to consider
sharing some of your time, talent and, yes, treasure with these
organizations. It is precisely this private element of charitable
support which keeps these organizations alive and well.
The federal tax code has long provided incentives for
charitable giving through itemized tax deductions. For those
who do not itemize and those who are unable to contribute
financially, there are still ways in which you can participate
in supporting our non-profit organizations. First, give your
“time” and “talent” to organizations that do good work and
have programming in areas that are of particular interest
to you. Secondly, consider sharing some of your “treasure”
through your estate plan. Even more so than in the income
tax arena, recent changes to the federal and Massachusetts
estate tax laws have dramatically decreased the amount of
estate taxes payable and thus have raised the amount of funds
available after taxes for your family or other loved ones. Why
not consider sharing some of this additional capacity with
the charities that have helped you, your family and your
community?
For example, you may consider endowing, in whole or
in part, an annual gift to an organization of your choice
through a gift from your estate. A bequest of $20,000 to an
organization’s permanent endowment which earns a 5%
return provides about $1,000 per year forever. Your gift can
be a specific dollar amount or a percentage of your estate’s
assets. You may also make a charitable gift of whatever
remains in your estate after specific bequests are left to loved
ones – known as a residual bequest. It is also possible to name
a charity as the beneficiary of a pension plan, IRA or life
insurance policy. You might also consider making a gift of
non-cash assets such as real estate, appreciated securities or
other tangible personal property. In a taxable estate situation,
removing items such as these from your estate can yield
substantial estate tax savings.
The variety of organizations needing support is also great,
from social service organizations to cultural, to medical
and educational institutions. If you are interested primarily
in social service needs and you do not have a particular
charity in mind, you may consider supporting umbrellatype organizations such as the United Way or the Greater
Worcester Community Foundation, both of which support
the work of the broadest range of non-profits.
The possibilities for making a positive impact in your
community as well as for your family and friends are endless.
You have the chance to truly enjoy the best of both worlds:
to feel good about leaving more to your friends and family
through savings in estate taxes, while at the same time
supporting those charities which have made a difference in
your life and your community. You may also find that the real
and sometimes unexpected benefit in implementing such
thoughtful planning is the good feeling you will experience
when you reflect upon the impact that your good deeds will
have on your community.
