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Life income gifts (trusts and annuities)

Making a life income gift

You may make a life income gift to the University of North Florida University by irrevocably transferring securities, money or other property to a trustee. The trustee may be the university, a bank, another institution or yourself.

The trustee manages the investment of the trust assets and pays an income to you, your designated beneficiaries, or both. The income payments continue for the beneficiary's life or, in some cases, for a term of up to 20 years.

Thereafter, the remaining trust principal goes to the University of North Florida to support the educational program of your choosing ----- in your name or in the name of someone you wish to honor.

Tax and other advantages of life income gifts

Donors to the University of North Florida have the satisfaction of knowing that they are supporting the best in higher education. In addition, a life income gift offers added rewards:

  • It pays you, your beneficiary, or both an income for life—in many cases a larger income than the gift property is presently earning for you.
  • It can offer significant tax advantages in the form of an immediate charitable deduction, avoidance of capital gains tax upon sale of any appreciated assets, and an eventual estate tax savings.
  • It relieves you of the burdens of asset management and enables you to support, in a major way, the University of North Florida program in which you are especially interested.

Choosing how your life income gift will be used

As a life income gift donor, there are various options for your consideration.

  • Restricted gifts support ongoing University needs such as faculty salaries, undergraduate scholarships, graduate fellowships and libraries. They can also be used to build and maintain facilities or to underwrite programs.
  • Unrestricted gifts are, in a sense, most valuable, as they allow the University to cope flexibly and imaginatively with future needs and organizational changes.
  • Endowed funds provide income every year in perpetuity to carry out the designated purpose of the gift.
  • Naming the fund: funds may be named in honor of the donor or to memorialize another person or persons. Named funds remain visible in the University of North Florida community because of the people and activities they support. As a result, they also encourage others to give.

Types of life income gifts

There are several principal types of life income gifts, giving you a range of choice in your investment and estate planning. One of them may be ideally suited to your particular circumstances. These gifts are described briefly below.

Charitable Remainder Unitrust (CRUT)

  • The annual income is not fixed to a specific dollar amount, but rather is a percentage of the asset value, usually between five and seven percent.
  • Provides for income growth as the trust assets appreciate.
  • If required payments exceed income, a portion of the principal (including accumulated gain) will be distributed.
  • Counters the effects of future inflation on a fixed dollar income.
  • If the trust income exceeds the required payment, the excess is added to the principal.

Gift annuity

  • In exchange for a gift of money or property to the university, the University of North Florida promises to pay a fixed amount each year to you or your designated beneficiary for life.
  • Gift annuity contracts can be thought of as consisting of two parts:
  • A current tax-deductible gift to the University of North Florida.
  • The right to receive a fixed dollar amount of income each year for the life of one or two beneficiaries.
  • The annuity distributed will depend upon the beneficiary's age at the time of the gift and the value of the property donated.
  • If the gift is funded with cash, a substantial part of the annual payments may be entirely tax-free.

Deferred gift annuity

  • An excellent way to plan for definite retirement income.
  • In addition to the benefits of a gift annuity, described above, by deferring the date on which annuity payments begin, you will receive a larger income tax charitable deduction in the year of the transfer.

These are just a few examples of Life Income gifting methods.

 

For more information about the University of North Florida's life income gift plans, please contact Brandon McCray, Assistant Vice President for Development (904) 620-2557 or via e-mail brandon.mccray@unf.edu

 

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