Tag Archive for: Grace of Giving 042023

A Legacy Gift 20 Years in the Making

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Eddie and Robert Verhelst, brothers from South Dakota, are third-generation farmers, working the land passed down through their parents and grandparents. Out of gratitude for the Lord’s blessings, they wished to set up planned gifts to support Christ’s gospel work. “We wanted to do something to share back our wealth,” says Eddie. “God has been so good to us.”

In the early 2000s, Eddie and Robert met with WELS Christian giving counselor Ken Dierks, who introduced them to charitable remainder trusts. After Ken retired, Christian giving coun­selor (CGC) Scott Wagner nurtured the relation­ship with the brothers, providing them with gift illustrations from WELS Foundation showing how they could fund charitable remainder trusts using stock that they held.

In late 2022, the brothers worked with their legal and tax advisors and WELS Foundation to establish charitable remainder trusts. Once established, they transferred their stock to the trusts, with WELS Foundation serving as trustee.

The brothers are grateful for the guidance from CGC Scott Wagner and the services provided by WELS Foundation. They also appreciate the income tax deduction they received and the fact that they didn’t have to pay capital gains tax on their gift. In addition, Eddie and Robert will receive income payments from the trusts for their lives, which they plan to use as additional gifts to support the charities they love. When the Lord calls them home, the remainder in the trusts will support WELS ministries.

“If you have stock to donate, this is a wonderful way to do it,” Eddie says. “It’s a win for every­body and a win for God’s kingdom.”

This is one way to use a charitable remainder trust. Learn more about charitable remainder trusts by contacting your local WELS Christian giving counselor at 800-827-5482 or [email protected].

Why Establish a Charitable Remainder Trust?

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If you desire to use appreciated property that may produce little to no income to support you or your family—and the Lord’s ministry—while avoiding taxes, the charitable remainder trust (CRT) might be right for you. Some who fit this category include farmers, investors, business owners, and landlords.

Here’s how it works:
A WELS Christian giving counselor (CGC) can provide you with gen­eral information and work with your advisors and WELS Foundation to establish the charitable remainder trust. Once established, you transfer cash, securities (stocks, bonds, mutual funds), or real estate to the trust with WELS Foundation serving as trustee. Charitable remainder trusts can provide income to you for life and/or to your children for up to 20 years. When it ends, the remaining property in the trust passes to your designated charitable beneficiaries such as your church and/or synod.

Here are the steps:

  1. Meet with a Christian giving counselor and advisors; complete paperwork.
  2. Transfer assets to the trust.
  3. The trust makes payments.
  4. The trust ends; the property passes to the charitable beneficiaries.

The benefits include:

  • You will receive an income tax charitable deduction and you don’t have to pay capital gains tax on the gift.
  • You and/or your children receive an income stream (quarterly payments).
  • You can continue supporting the Lord’s work after you go to heaven.

The minimum gift size is $200,000. WELS Foundation’s recommended payout rate is five percent. Payments can be a fixed or variable amount. You can choose several income beneficiaries and the length of the trust term. WELS Foundation as trustee manages the assets for the benefit of the income beneficiaries and charitable beneficiaries.

 

Learn more about charitable remainder trusts by contacting your local WELS Christian giving counselor at 800-827-5482 or [email protected].

Watch a video about how WELS members Jerry and Lynn Zimpelmann support WELS mission work through their charitable remainder trust.

SECURE Act 2.0 Opens New Use for Qualified Charitable Distributions

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Donors 70.5 and older have enjoyed making tax-free qualified charitable distributions (QCDs) from their IRA that also count toward their yearly required minimum distribution (RMD). Legislation passed at the end of last year, known as SECURE Act 2.0, allows donors to fund a charitable gift annuity (CGA) through a QCD.

An individual can now make a QCD of up to $50,000 (out of the $100,000 overall annual limit on IRA qualified charitable distributions) into a CGA in one calendar year. A husband and wife can each distribute up to $50,000 from their IRAs in one year for a CGA (maximum $100,000). A CGA provides the donor and/or his/her spouse with fixed quarterly payments for life. Then, after the donor goes to heaven, the remainder of the gift goes to ministries chosen by the donor.

The QCD into a CGA counts toward the RMD for those required to take it (as of 2023 the age at which RMDs must begin has been raised to 73). Since it can only be done in one tax year, it may make sense to consider distributing the maximum $50,000 amount when you decide to do it. The distribution can be split between multiple CGAs in one year as long as the total doesn’t exceed the $50,000 limit. Because the QCD is a tax-free distribution from your IRA, there is no tax deduction for the gift and the CGA payments are fully taxable.

You might want to consider this new giving opportunity if:

  • you do not itemize on your taxes.
  • you want to provide an income stream to you and/or your spouse.

A WELS Christian giving counselor can help you get started. If you are interested, call 800-827-5482 or e-mail [email protected].