Leaving a legacy
Planned giving is a great way to support the Woods Hole Oceanographic Institution’s (WHOI’s) innovative ocean research and education programs while gaining financial and tax benefits for you and your family. It’s also a great way to create a lasting legacy. Plus, planned giving donors are automatically inducted into the Paul M. Fye Society, the recognition society for those who have created a planned gift to help secure WHOI’s future. Explore your giving options below, or talk to one of our specialists.
What will your legacy be?
For more information on Planned Giving and the Fye Society, email Jim Flynn, Director of Major Gifts & Planned Giving, firstname.lastname@example.org.
Support WHOI in your will, trust or retirement plan
It’s easy to make a provision for the Institution in your will, trust, or retirement plan and contribute to important ocean discoveries at the same time. Your bequest can be designated to a fund of your choice, can be added to the institution’s general endowment, or can be a completely unrestricted gift. Your generosity ensures that WHOI remains a leader in ocean science.
There are a number of ways to make a bequest to WHOI:
- Designate a specific dollar amount or property
- Set aside a percentage of your total estate or trust
- Give a percentage of your estate to WHOI after other provisions are made for your loved ones
- Assign WHOI all, or a portion, of the assets in your retirement account.
Many individuals have life insurance policies whose benefits they no longer need. If this applies to you, you may want to consider naming WHOI the beneficiary and assigning WHOI as owner of the policy. You will receive a charitable deduction and you may also reduce your estate taxes.
- You make a gift of an asset that you and your family no longer need
- You receive an immediate income tax deduction for the gift’s value, plus possible estate-tax savings
- You make a significant gift with little expenditure
If you have a vacation home you no longer use, you can donate it to WHOI.
Real estate often represents a significant portion of a person’s wealth, but is not as easily liquidated as stocks and bonds. WHOI has experience receiving and selling real estate and can take the burden of managing that process off of your hands. WHOI has certain standards for the properties that we will accept—primarily to avoid environmental litigation—so please contact us if this strategy is of interest to you.
Another option with real estate is to transfer ownership, but continue to occupy the property until you are finished with it. The current interest-rate environment offers historically large charitable deductions for these kinds of gifts. Using this approach, known as retained life estate, you will receive a substantial tax deduction that may be carried forward for as many as five years, if necessary. In addition, your heirs will not have to worry about selling your home. You will still be responsible for the upkeep and taxes on your home.
A 72-year-old has a home she originally purchased for $200,000 that is now valued at $500,000.
Assuming the structure (not the land on which it sits) is worth $150,000, she can deduct $352,667 if she assigns the property to WHOI as a gift, and the deduction will increase as she ages.
She can take a charitable deduction of up to 30% of her adjusted gross income, and can use it for up to five additional years if she can’t take the whole deduction in the first year.
Retirement Plan Assets
Using your retirement plan is a simple way of making a bequest to Woods Hole Oceanographic Institution (WHOI), while protecting your children from additional taxes. If your IRA, 401(k), 403(b), or other retirement plan is left entirely to your children, they must pay income taxes when they withdraw money from the plan.
You may designate WHOI as a beneficiary of part or all of the remainder of your IRA, TIAA-CREF, KEOGH, profit-sharing plan, qualified pension or other retirement assets.
- Your heirs avoid income and possible estate taxes
- You can continue to withdraw from the plan for the rest of your life
- You can give a portion of your IRA plan to your heirs and a portion to WHOI
- You can maintain the control and flexibility to change beneficiaries during your lifetime
To make this gift:
- You must notify your plan’s administrator.
- You will need a “change of beneficiary” form.
I joined the Fye Society when I was 53 years old. Not many younger people think about their estate plans; I think they should. I wanted my commitment to WHOI to be clearly understood by my executors.” —Michele Foster, Fye Society Chair
Charitable Gift Annuities
Gifts That Pay You Income for Life
You may be able to support WHOI's mission, get a tax reduction and increase your income with one gift!
A charitable gift annuity is a contract in which the Institution agrees to make payments to you for life in exchange for a lump-sum gift of cash, stock or property. The gift will trigger an immediate income tax deduction, and in most cases, a portion of the income provided will be tax-free. The annuity may cover one or two people. The percentage payout is based on your age when you make the gift. Rates are higher for older donors (see below). If you fund the annuity with appreciated stock, you can minimize your capital gains tax liability to receive more income than the stock dividend had provided.
A 70-year old who funds a GCA with $25,000 will receive an annual income of $1,325 and a tax deduction of $11,058. If we assume a marginal tax rate of 33%, the deduction will reduce the donor's tax bill by $3,686. The cost of the gift is then $3,686 less than $25,000, or $21,314.
$1,325 (annual income) /$21,314 (Cost of gift after tax) gives an effective rate of 6.2%.
A deferral of income (at right) offers a higher annuity rate and a higher charitable deduction.
To see how this may fit into your philanthropic plans, please try our planned giving calculator.
Deferred Gift Annuity
Give now, receive later
A deferred charitable gift annuity (like a charitable gift annuity) is a simple contract between WHOI and you, the donor. In exchange for a gift of cash, appreciated securities, real estate or other asset, WHOI guarantees payments (beginning at a pre-determined future date) for life to the income beneficiary.
- An increased income payment and charitable deduction compared with a charitable gift annuity
- Guaranteed payments, protected from the fluctuations of the economy and backed by all of WHOI’s assets, for the lifetime of the beneficiaries
- A federal charitable deduction representing a significant portion of the fair market value of the gift
- An opportunity to minimize capital gains tax liability on appreciated assets, such as stock, when they are used to fund the gift annuity
The deferred gift annuity may be an attractive charitable gift option for several reasons. First, if you are still working, this may serve as an additional retirement instrument with current tax benefits. The donor can make a gift of $10,000 or more now, and defer the income until age 65 or older.
Second, by deferring your income to a later date, you receive a larger charitable deduction in the year of the gift, and you also receive a greater fixed income when payments begin.
Deferred gift annuities are ideal for building up resources for your retirement while enjoying tax benefits today. Unlike retirement accounts, there is no ceiling on how much you can contribute.
The example below illustrates income benefits and charitable deductions for a $10,000 gift established at sample ages and deferred to age 70
|Age||Number of Years Before Payment||Annuity Rate|
To see how this may fit into your philanthropic plans, try our planned gift calculator.
I am proud that I have an asset with appreciation to help maintain WHOI’s leadership, not just in oceanography, but also in promoting public engagement with science.” —Dr. Cecily Cannan Selby
Charitable Remainder Trusts
You can provide for yourself, your loved ones, and WHOI with a charitable remainder trust. The trust may hold assets for a number of years (up to 20) or for the lifetime of the income beneficiaries. At the conclusion of the trust, the remaining assets are transferred to WHOI to be used as the donor directed.
- Donors may elect to receive either a fixed percentage of the fair market value of the trust as it is valued annually or a fixed annuity. The minimum payout rate is 5%.
- These trusts are highly customizable – you have flexibility on the amount that is paid out and when payouts begin.
- Unlike the gift annuity, donors may choose to have more than two individual beneficiaries.
- They may be funded with appreciated assets such as stock, real estate or other assets.
- They can provide a substantial charitable deduction to the donor.
- Charitable remainder trusts can be useful retirement tools.
For information based on your particular circumstances, please use our planned gift calculator.
Charitable Lead Trusts
A Strategy for Reducing Estate Taxes and Passing Assets to Heirs
Charitable lead trusts hold special interest if you wish to pass an asset to the next generation while minimizing gift and estate taxes. A charitable lead trust holds an asset (or assets) for a term of years during which time income is paid to a charity. With the most common lead trust, the trust assets are distributed to another individual—typically a child or grandchild—at the conclusion of the trust term.
Working with your advisor, you may choose to have the charity receive either a fixed percentage of the fair market value or a pre-determined fixed dollar amount.