Types of Gifts
Regardless of how donors have chosen to participate, their gifts to Volunteer State Community College make an investment in human potential and enhance opportunities for all of us as well as future generations through their support of learning.
Volunteer State College Foundation provides the following giving vehicles which allows donors the flexibility they seek in making philanthropic decisions.
- Outright Gifts
Outright gifts remain a valuable and viable source of donations for Volunteer State Community College and its programs. Regardless of size, an outright gift is an effective way of assisting VSCC to fund areas the donor considers important. The most common donations to the college come from outright gifts, such as cash, which are received and utilized right away.
A gift of cash is the simplest form of giving, whether a donor wishes to support general scholarships, create a scholarship or endowment, benefit an academic program or designate monies to a capital campaign.
Cash gifts provide the most immediate benefits for the donor and the college. Individuals who itemize income tax returns can deduct donations of cash to VSCC.
An alternative to cash is a gift of appreciated securities, which can offer income tax deduction benefits as well as savings on capital gains.
- Personal Property
Book, art, manuscript, and other special collections offer donors an opportunity to share coveted treasures as well as benefit from an income tax deduction and reduction of estate taxes.
As with all gifts, the Foundation Office can discuss ways to maximize the benefits of personal property gifts for both the donor and the college.
- Real Estate
Volunteer State Community College friends and alumni wish to tap into the value of their residences, vacation homes, farms, and other properties through donations of real estate.
An appreciated gift of property results in the benefits of an income tax charitable deduction as well as other economic advantages for the donor. Other special considerations can be discussed in consultation with a financial advisor.
- Matching Gifts
Through corporate matching, charitable contributions can be doubled or even tripled. The process is as simple as completing a standard matching gift form provided by your employer and mailing it with your gift to the Foundation. The proceeds from the match will be placed toward the same program as the original gift.
You may contact your Human Resources Department directly to learn whether your employer has a matching gifts program.
- Planned Gifts
Through planned gifts a donor arranges a gift to the college for realized benefit in the future.
A contributor to VSCC may find that planned giving offers attractive benefits. It can increase current income for the donor or others, reduce the donor's income tax and avoid capital gains tax and pass assets to family at a reduced tax cost, while offering a significant donation to the college.
- Gifts by Will (Bequests)
Gifts associated with a will and the final distribution of an estate offer donors and the college a great deal of potential. A bequest, or gift by will, is an attractive option when a donor is currently unable to make an outright gift, but wishes to make a contribution to VSCC in a meaningful way.
A specific bequest will involve donating a set amount or percentage of assets from an estate to the college. Residual bequests are left to the Foundation after all debts, expenses, and taxes have been paid from an estate.
- Living Trusts
A trust is a legal agreement that specifies how the assets placed under the trust will be managed. A living trust can be established to take effect during a donor's lifetime.
Benefits include possible savings in estate taxes if a charity is the beneficiary of the trust remainder. Also, the terms of the trust can be changed at any time.
- Retirement Plan Assets
A qualified retirement plan remains one of the most ideal ways to accumulate wealth and a secure future. Yet, this may be an ineffective way of transferring wealth or preserving assets after a lifetime. A large portion of assets from a qualified retirement plan, such as profit sharing, a 401(k), a 403(b) or an IRA, can be exposed to taxation of up to 75 percent.
Income and estate taxes can be reduced through a charitable gift of retirement plan assets. A donor can choose the most ideal type of planned giving arrangement for transferring the balance on an account to Volunteer State Community College.
Some of the possibilities include naming Volunteer State College Foundation as the beneficiary of retirement assets through the plan administrator. A benefactor also can transfer retirement assets at death to a tax-exempt deferred giving plan, such as a charitable remainder unitrust or a charitable remainder annuity trust.
The procedure for donating a life insurance policy is simple and is a popular way to give with little expenditure. Whole life insurance can be offered by naming Volunteer State Community College as the irrevocable owner and beneficiary.
The policy can either be paid up or, if not, should follow these criteria as of the date of the gift:
- Minimum face value of $100,000 Payment schedule not to exceed ten years Assumes an interest rate not to exceed 2 percent below the prime interest rate as of the effective date of the policy.
- Charitable contributions from the donor to the Foundation in the amount of any premiums may be required with gifts of life insurance policies.
- Charitable Remainder Trusts
Donors often choose the charitable remainder trust as a way to achieve a variety of financial goals while making a significant gift to Volunteer State Community College. (A trust is a legal agreement that specifies how the assets placed under the trust will be managed.)
Through a charitable remainder trust, a donor can contribute assets to the trust and receive a life income. The remaining principal will go to the charity, specifically Volunteer State College Foundation.
There are two types of charitable remainder trusts - the unitrust and the annuity trust. Under a unitrust, annual income to the donor is paid as a fixed percentage of the fair market value of the assets. Under the annuity trust, the donor receives annual income as a fixed payment equaling at least 5 percent of the value of the asset at the time the deferred-giving agreement is signed.
The advantages of establishing a charitable remainder trust include an income stream for life, avoidance of taxes on capital gains for appreciated securities or real estate, and reduction of estate taxes, a charitable contribution income tax deduction based on life expectancy.
- Charitable Lead Trusts
The exact reverse of a charitable remainder trust, this type of deferred gift offers a charity, specifically Volunteer State College Foundation, an income for a period of time after which individual beneficiaries receive the remainder of the trust.
Creating a charitable lead trust will allow a donor to share surplus income with the college, then pass the principal to family at greatly reduced gift and estate taxes. The donor may also opt to retain the asset after the term of the income stream is completed.
- Gift Annuities
A popular way of establishing an immediate or deferred gift annuity is to make a gift of cash or appreciated securities to Volunteer State College Foundation (VSCF) with a minimum of $10,000. The donor is paid by the UHF a guaranteed fixed percentage of the value of the gift quarterly for the lives of two annuitants, who must be at least 50 years of age.
All immediate and deferred gift annuity contracts benefiting Volunteer State Community College will be initiated between VSCF and each individual annuitant. Per each gift annuity agreement, VSCF is responsible for the management of all assets contributed. Your return is backed by the full faith and credit of VSCF and is guaranteed for life. Recommended annuity rates are based on the age of the annuitant. PGCalc provides a table of American Council on Gift Annuities' suggested maximum payout rates for gift annuities.
A charitable gift annuity offers several advantages, including guaranteed fixed payments for life and a charitable tax deduction for the gift. Also, if funded with appreciated securities, capital gains taxes are reportable over the donor's lifetime. Gifts made are permanently removed from the donor's estate for estate tax calculation purposes.
- Retained Life Estates
- A home can be another way to give to Volunteer State Community College and benefit from the tax deduction for the property's discounted value. With a retained life estate, a donor can give a residence to the college and continue to reside in or rent the property. Also, money spent on property maintenance can be a charitable contribution to the institution.