by Alan Hill

 

This is the third of a three-part series on advanced ways to financially support your United Church of Gainesville. In part one we learned about qualified charitable distributions (QCD’s) from a traditional individual retirement account (IRA) for persons at least 70 ½ years. In part two we described the use of donor-advised funds that the sponsor can use to direct grants to charities, especially UCG. In this part we will talk about how to support the church even after you have passed away. 

INCLUDING UCG IN YOUR ESTATE PLAN 

Designating the United Church of Gainesville in your estate plan is a great way to impact your church even after you are gone. If your estate exceeds fifteen million dollars, remembering UCG in your will can potentially save your heirs from paying a large federal estate tax. 

 

Ways to put UCG in Your Estate Plan in Florida 

 

Make UCG a Beneficiary in Your Will 

Naming UCG in your will is the simplest way to give in your estate plan. You can designate the percentage of your estate that you’d like to leave, just as you would with other beneficiaries such as your children. You can even write provisions such as only leaving money to UCG if your children have passed away. 

You can also provide a specific amount to be given to UCG from your estate. The one caveat is that your estate might not have that much left in it at the time of your passing. 

Putting UCG in your estate plan in Florida through your will means the funds will be donated after you die. Normally the control you have over how the assets or funds are used will be limited, unless you designate the UCG Endowment as your beneficiary. Funds given to the endowment must be used in accordance with rules governing the endowment when it was created or later amended by the church members. 

Having UCG as a beneficiary in your will may require the will be probated in Florida. This is legal proceeding where the probate court oversees the administration of the deceased person’s estate, ensuring that debts are paid, assets are distributed to rightful heirs or beneficiaries, and that wills are validated according to the law.

You should consult an estate planning attorney before making any changes to your estate plan. 

 

Transfer on Death Deeds 

Florida allows transfer on death deeds for real estate, providing a simple method for transferring property outside of probate. 

 

How Transfer on Death Deeds Work: 

Property owners can record a deed that transfers real estate to named beneficiaries upon death while retaining full ownership during lifetime. 

Key features include: 

  • Owner retains complete control during lifetime.
  • Can be revoked or modified at any time.
  • Automatic transfer upon death.
  • No probate required for transfer.
  • Beneficiaries receive stepped-up tax basis.   

 

Requirements and Procedures: 

  • Must be properly executed and recorded.
  • Specific statutory language required.
  • Beneficiaries must survive the owner. Hopefully UCG survives us all.
  • Property subject to owner’s debts and liens.

 

Advantages and Limitations: 

Advantages: 

  • Simple and inexpensive.
  • Retains lifetime control.
  • Avoids probate.
  • Maintains homestead benefits.

 

Limitations: 

  • Limited to real estate only.
  • No incapacity planning benefits.
  • May complicate estate planning.
  • Potential creditor issues.

 

Revocable Living Trust 

A revocable living trust is a legal entity that holds title to assets during the grantor’s lifetime and distributes them according to trust terms after death. A revocable living trust can hold real estate, including your home, bank accounts and CD’s, investment accounts and securities, business interest and partnerships, personal property and collectibles, intellectual property and royalties. 

 

The key features of a revocable living trust include: 

  • Grantor (you) maintains complete control during your lifetime.
  • Assets can be added or removed at any time.
  • Trust terms can be modified or revoked.
  • Successor trustee manages the assets after death.
  • No court supervision (probate) is required for distribution. 

Advantages of Living Trusts: 

  • Complete avoidance of probate for trust assets.
  • Privacy – there is no public record.
  • Faster distribution to beneficiaries.
  • Less administrative costs than probate.
  • Incapacity planning benefits.
  • Flexibility for complex distribution plans.
  • Multi-state property management.

Considerations and Limitations 

  • Initial setup costs and complexity.
  • Ongoing trust administration requirements.
  • Assets must be properly transferred to the trust.
  • There are no tax advantages during the grantor’s lifetime.
  • May not be cost-effective for smaller estates.

 

Via a Charitable Remainder Trust 

Creating a charitable remainder trust is a nice option if you want to donate while you’re still alive. You can make tax-free donations and reduce your taxable income too. 

Trusts are entities that hold ownership of assets and funds, operating in the best interests of beneficiaries. Charitable remainder trusts are irrevocable, so they can’t be amended once created. However, they can still provide a potential income stream for the other beneficiaries. 

They work as follows: 

  • The trust creator donates assets or funds to the trust. 
  • The trust pays non-charitable beneficiaries an income for a specified period. 
  • After the specified period of time, the remaining assets of the trust are donated to the desired charity or charities. 
  • The trustor can receive a charitable income tax reduction for the remaining amount. 

As always, consult a Florida licensed trust planning lawyer if you are interested in creating a charitable remainder trust. 

 

Use a Life Insurance of Charitable Gift Rider 

If you name a charity as a beneficiary on your life insurance policy, the charity will receive the proceeds just as your family usually would. This option also allows the funds to bypass probate in Florida. 

Charitable gift riders also present another route to donation, as they pay a percentage of the policy’s face value to a qualified charity.  These types of riders can limit how much you can give. 

 

Summary 

There are a variety of ways that you can support United Church of Gainesville now, in the future, and after you have passed away. Your gifts can support the church in a variety of ways, too. 

  • Financial gifts can support the church’s annual budget through a pledge, one-time gift, or just adding to the collection plate during a Sunday morning service. 
  • Financial gifts can be directed to a specific need or project of the church that is outside the annual budget. 
  • Financial gifts can be directed to the church endowment that provides for the future needs of the church that fall outside the normal annual budget. 

Giving can come from a variety of sources:

  • Direct payments of cash, check or credit card. 
  • Gifts of stocks or securities.
  • For those 70 ½ or older, a qualified charitable contribution from an individual retirement account. 
  • From grants you direct through a donor-advised fund that you have set up. 
  • Gifts as part of your estate planning. 
  • Making UCG or its endowment a beneficiary in your will. 
  • Creating a transfer on death deed.
  • Making UCG a beneficiary of a revocable living trust.
  • Through a charitable remainder trust. 
  • Making UCG or its endowment a beneficiary of your life insurance policy or adding a charitable gift rider to your life insurance policy.