Faith Lutheran Church

FAITH FOUNDATION

The Faith Foundation is an Endowment Fund comprised of gifts and bequests held separate from the operating budget of Faith Lutheran Church. The Fund was established in 1984 to provide a meaningful extension of stewardship opportunities for members and friends of the Congregation.

OUR MISSION
To provide brothers and sisters in Christ the opportunity to share their life's gifts in support of the mission of Faith Lutheran Church for lasting benefit of this and future generations.

OUR VISION
The Faith Foundation provides stable, dependable, long-term financial resources for enhancing and expanding the vision of Faith Lutheran Church.

FOUNDATION PURPOSE
The Faith Foundation is an Endowment Fund comprised of gifts and bequests held separate from the operating budget of Faith Lutheran Church. The Fund was established in 1984 to provide a meaningful extension of stewardship opportunities for members and friends of the Congregation.
Planned giving is a kind of stewardship, which gives beyond our years. It allows us to be good stewards of all those "things" we have accumulated.
Not only will this kind of stewardship be a blessing to others, it will also provide a blessing to you. Just as you feel a sense of satisfaction each time you share from your income, you can in an even greater sense experience the joy of knowing that after you are called home, a portion of what you have accumulated will be directed, as you have chosen, to the causes that are important to you. The Faith Foundation will help you do that. By suggesting creative ways to give, we can help direct your resources that can help you today, and help Faith tomorrow.

The Foundation can provide off-budget funds for:

• Youth Programs
• Church Camp Sponsorship
• Mission Congregations
• Seminary Scholarships
• Special Events
• Emergency Expenses
• Outreach
• Matching Funds for Ministry Fundraisers

Funds in the Faith Foundation are manged by the Endowment Committee, which is appointed by the church council.

HOW YOU CAN GIVE;

• Direct Donations
• Charitable Remainder Trust
• Annuity Trust
• Unitrust
• Charitable Lead Trust
• Charitable Gift Annuity
• Deferred Payment Charitable Gift

Direct Donations

Direct donations can be made by simply writing a check to Faith Foundation and placing it in the offering plate. For your convenience, Faith Foundation envelopes can be found in the sanctuary in the seat backs.

When your donations reach the $100 level, a tag with your name identifying you as a Friend of the Faith Foundation will be placed on the Faith Foundation plaque in the Centrum. Donors of $1000 or more will be identified as Benefactors.

Key Benefits;

Charitable Remainder Trust

A Charitable Remainder Trust is a creative tool that gives you income for life and provides a wonderful gift for FLC. Assets that have substantially appreciated in value but are providing a low return are well suited as gifts. You may avoid capital gains taxes, lower your income taxes and earn higher returns with this vehicle for giving. Income can be based on the asset's initial fair market value or its annual net fair market value.

Annuity Trust

An annuity trust makes fixed payments of a percent (minimum 5%) of the trust's initial fair market value. The trust’s change in market value will not impact the amount paid. The annual annuity trust payment is paid first from trust income then, if necessary, from the trust principal. Additional contributions cannot be made to an annuity trust.

Unitrust

A Unitrust can make straight payments of a fixed percent (minimum 5%) of the trust's annual net fair market value. Other options may be chosen or required. For example, a payment may be the lesser of the net income of the trust and the stated percent of the annual fair market value. The Unitrust payment fluctuates according to the annual net fair market value of the trust. Additional gifts may be made to a Unitrust in subsequent years or upon death.
Charitable Lead Trust

If you want to minimize estate and gift taxes on assets you intend to leave to your children or grandchildren, particularly when significant assets are expected to appreciate, you may want to consider a Charitable Lead Trust. A charitable lead trust can provide annuity payments to the Faith Foundation for a specified period of time (usually a fixed number of years). Then, at the end of that term, assets in the trust pass to your personal beneficiary such as a child or grandchild (or even back to you).

Key Benefits:

• Reduces taxes that would otherwise be due on assets left to children and grandchildren.
• Allows donor to make a substantial gift over a period of years until assets are passed on to family.
• Any growth in the asset beyond what is promised to the charity goes to the beneficiaries when the charity's term ends.

Limitations:

• Although part of a long-term gift to one's family, it is considered a temporary gift in terms of philanthropy.

Best Assets:

• Rapidly appreciating assets that one intends to pass on to heirs.

Charitable Gift Annuity

A charitable annuity allows you to make a meaningful gift to Faith Lutheran Church, while also providing you a guaranteed annual income for the rest of your life. Your gift continues to give even after your death. Faith will receive the remaining portion of your annuity after your life ends.

A gift annuity makes it possible to transfer cash, real estate, or securities such as stocks or bonds, to FLC. In exchange, you or someone you designate will receive fixed payments for life.

Key Benefits:

• Income beneficiary earns a fixed annual amount; this is especially advantageous if you're 65 or older.
• Charitable gift annuity interest rates may provide you with a current income that is greater than your assets are currently producing.
• The IRS designates a portion of your annuity as a charitable gift. You get an income tax deduction for the gift portion.
• A portion of your future annuity payments is considered a return of principal and is tax-free.
• Assets can be used by FLC after beneficiary's lifetime.
• If you fund your annuity with an appreciated asset, you may avoid some capital gains taxes.

Limitations:

• Annuity payments are fixed and do not provide a hedge against inflation.

Best Assets:

• Cash
• Securities

Example:

Mrs. Muller is 75 years old. She needs to increase her income and at the same time she wants to support her church. Mrs. Muller owns some stock she bought in 1979 for $4,500. Today the stock is worth $9,000 but she only receives a dividend of 2% or $180 per year.

Mrs. Muller decides to gift the Faith Foundation her stock in exchange for a Charitable Gift Annuity. The Faith Foundation agrees to provide Mrs. Muller with a guaranteed fixed income for life. Mrs. Muller receives an annuity payment that is larger than the dividend she is currently receiving and a portion of her annuity payment is tax free. She also gets a charitable gift tax deduction when she makes her gift. That means she has increased her income and saved on her taxes at the same time! More important, Mrs. Muller has the joy of knowing that her gift is helping to fulfill the ministries of Christ.

Deferred Payment Charitable Gift

You may know the benefits of a Charitable Gift Annuity; by making a charitable gift to the Faith Foundation you receive a tax deduction now and a guaranteed income for life. However, you may not need the income now. The Deferred Payment Charitable Gift Annuity may be the perfect option for you.
With the Deferred Payment Charitable Gift Annuity, you make a gift now (thus receiving an income tax charitable deduction in the year of the gift) and receive a guaranteed annual income for life beginning at a future date of your choice. Through one gift you can receive current and future benefits.

Key Benefits:

• You receive a guaranteed annual lifetime income, starting when you choose.
• By being deferred, your payments will be higher than for a Charitable Gift Annuity.
• Because your tax deduction is immediate but payments are deferred, your tax deduction is larger than for a Charitable Gift Annuity.
• Your gift increased the value of your overall retirement package.
• If you wish, you can add to your gift every year with each new gift beginning its deferred payments at the same time.
• Assets can be used by FLC after beneficiary's lifetime.
• If you fund your annuity with an appreciated asset, you may avoid some capital gains taxes.

Limitations:

• Annuity payments are fixed and do not provide a hedge against inflation.
• The percentage payment is linked to donor's age at the time the payments begin.

Best Assets:

• Cash
• Long term appreciated stocks
• Bonds
• Incentive cash bonuses

Example:
Sam and Jane are 55 and 53 respectively. They are at the peak of their careers. Although they want to make a significant gift to their favorite ministry, they don’t need additional income now, but they may need additional income when they retire. They decide to gift stock which has appreciated substantially for a Deferred Payment Charitable Gift Annuity. They will receive an income tax deduction for a portion of their gift. At a predetermined future date, they will begin receiving fixed quarterly income payments with a lifetime term.

Do you have a will?
At one time or another, most people think about making a will. Individual circumstances are different, but every person should have a will. If you don't have a will, the state has one for you. If you have not prepared your will, your state of residency at death will distribute your estate according to its laws. Your estate will be divided according to a formula, without taking into account any special needs of your family or your personal wishes. Without a will, you lose the power to control the disposition of your property. Furthermore, your estate has no charitable intent.

Only through a will can you;

• Distribute your property as you choose,
• Appoint your own executor,
• Minimize certain estate costs,
• Suggest a guardian for surviving minor children,
• Provide for trusts,
• Exercise testamentary powers of appointment, or
• Provide for your church or favorite ministry.

What about jointly owned property?
Jointly owned property does not eliminate the need for a will. Although joint tenancy with right of survivorship, such as bank accounts, real estate, and stocks, will automatically pass to the survivor, it is possible for both joint owners to die in a common accident. The only way to insure that your final wishes are carried out is to prepare separate wills.

What does a will do?
A will provides a plan for the distribution of your estate. It expresses your final wishes to family and heirs. It is the final witness to your Christian Faith.

When should I make a will?
It is never too early to consider how you would like your property dispersed. When you have made a plan, visit your attorney and have your will prepared. Important decisions will be made which require professional advice. Without a legal will, your desire to benefit your family, your congregation, and Faith Foundation may not be achieved.

Your will does not become final until your death or incompetence. Changes in circumstances may require changes in a will. If you already have a will, consider the following questions:

• Is my will up-to-date?
• Do I have any minor children?
• Has the size of my estate changed significantly since my will was written?
• Have any of the individuals (executor, beneficiary, and ministry) named in my will died or ceased operation, moved, or changed names?
• Is the church or Faith Foundation included in my will?
• Should I learn more about life income gifts?
• Have I provided a means to pay for probate and estate taxes?
• Has any tax law changed which will have an impact on my planned disposition of property?
• Have I considered a Christian Preamble to my will?

Remember Faith Foundation in your will.

As a Christian, you are the caretaker of the unique God-given gift of life. You have rejoiced in your talents by being a lifelong steward. The distribution of your estate is the last witness of your life. You can continue your Christian stewardship by providing for the work of the Church in your will.

There are many ways to express your stewardship through your will.

• Give Faith Foundation a certain percentage of your estate.
• Establish a Faith Foundation endowment fund that will continue to support FLC forever.
• Create a life income plan to provide an income for a survivor and designate the church as final beneficiary.

The above examples are just a few of the options available.

Contact Faith Foundation for assistance in establishing your life goals as well as providing for your legacy.

Take the estate planning quiz!

Links to useful estate planning websites:

Cornell Law School http://www.law.cornell.edu/wex/index.php/Estate_Planning

California State Bar http://calbar.ca.gov/state/calbar/calbar_generic.jsp?cid=10581&id=2206

American Bar Association http://www.abanet.org/rppt/public/home.html

Money Magazine http://money.cnn.com/magazines/moneymag/money101/lesson21/

SmartMoney.Com http://www.smartmoney.com/estate/

SaveWealth: Estates http://www.savewealth.com/planning/estate/

FreeAdvice.Com http://law.freeadvice.com/estate_planning/estate_planning/

Wikipedia http://en.wikipedia.org/wiki/estate_planning




Estate Planning Quiz

T / F A Will provides for death, not incapacity.
(True.)

T / F A Simple Will, i.e., “to my spouse if he/she survives me, if not then to my children” is sufficient for estate purposes.
(False.)

T / F A Living Will addresses when life support equipment may not be desired.
(True.)

T / F A dissatisfied beneficiary can’t be stopped from contesting my will.
(True. BUT, you can include an in terrorem clause, which provides that if a beneficiary contests the validity of a will, that beneficiary’s bequest will be void. They risk losing their bequest under the will if their challenge is unsuccessful.)

T / F Probate is not subject to any more publicity than a trust.
(False. Probate is a court proceeding and documents filed in court are public records available to the media and anyone else who cares to look. Trusts are not public documents. While the trust document may have to be produced or shown to the court in order to transfer assets, it’s contents do not become a part of the public record.)

T / F State law provides a safety net and will distribute my estate to my family members.
(True. State law does provide a method of allocating estate assets to family members. BUT, the State will transfer assets according to an inflexible formula that may or may not reflect the wishes of the decedent.)

T / F A Durable Power of Attorney takes the place of your Will.
(False. A Durable Power of Attorney can be used WITH your Will.)

T / F A Health Care Proxy specifies your physician of choice.
(False. A Health Care Proxy names an individual to make health care decisions.)

T / F The Death Benefit of individually owned life insurance is not included in the taxable estate of the individual owner.
(False. It is included.)

T / F The Estate Tax is due within 6 months of the date of death.
(False. The Estate Tax is due within 9 months of the date of death.)

T / F Small estates (less than $675,000) do not benefit from estate planning.
(False. Without estate planning that results in at least a properly executed will, probate costs and expenses will consume a larger percentage of smaller estates. Heirs having to sell everything they just inherited, and then some, to pay expenses illustrate this.)

T / F The unlimited marital deduction will protect against estate taxes.
(True. The surviving spouse will not pay estate taxes on their inheritance. BUT, sole reliance on the unlimited marital deduction will only compound estate tax problems when the second spouse dies.)

T / F Qualified Retirement Plans are the best place to have assets while living and the worst place to have assets at death because they are subject to double taxation (estate and income tax) upon distribution.
(True.)

T / F Outright transfers (during one’s lifetime or at death) are always protected from the creditors (personal injury, divorce, etc.) of the recipient for one year.
(False. Outright transfers may be immediately available to the creditors of the recipient.)

T / F Outright distributions (at your death) are subject to an Estate Tax not only at your death, but once again upon the death of the recipient if they also make outright distributions.
(True)

T / F A Living Trust provides for incapacity, not death.
(False. A Living Trust provides for incapacity AND death.)

T / F The faith Foundation can benefit from certain types of Charitable Estate Planning.
(TRUE!)

Some biblical quotes to sprinkle through the web pages.

"Command them to do good, to be rich in good deeds, and to be generous and willing to share. In this way they will lay up treasure for themselves as a firm foundation for the coming age, so that they may take hold of the life that is truly life." (1 Timothy 6:18-19)

"But store up for yourselves treasures in heaven, where moth and rust do not destroy, and where thieves do not break in and steal. For where you treasure is, there your heart will be also" (Matthew 6:20-21)

“This is all the inheritance I can give my dear family. The religion of Christ can give them one which will make them rich indeed.” (Will of Patrick Henry)