In Matthew 25:34-40, Jesus implores people of faith to heal the sick, clothe the naked, welcome the stranger and provide a drink of living water to the thirsty soul. In doing these things “to one of the least of these,” he said we are also doing them to him.
But how do we respond to that call to care for those in need, for the downtrodden and the marginalized? We do it from a deep sense of gratitude and generosity, both of which are built into our DNA by our creator. And I know of no better way to follow Jesus’ example than by making generous offerings of our prayers, presence, gifts, service and witness through The United Methodist Church and its worldwide connection.
There are a number of ways to accomplish our need to give, especially at year-end, when many people are carefully planning their giving in light of tax law and government programs. Here are the “nuts and bolts” of a few of them.
Gifts of cash
If you made a pledge for calendar year 2015 and your economic situation allows, please consider paying your pledge in full by the end of the year. No matter your income level, if you itemize deductions on your tax return, you will receive a tax deduction for your gift.
You may also consider pre-paying all or a portion of your 2016 pledge before the end of 2015, depending on your own cash flow and deduction situation. Consult with your financial or tax advisor to determine what’s best for you.
Gifts of appreciated securities
Gifts of appreciated securities (shares of individual stocks, bonds, mutual funds) are very attractive tax-wise. If you give appreciated securities to your church, not only do you receive an income tax deduction for the full value of your gift, but you also avoid the capital gains tax were you to have sold the securities yourself. When you give stock to the church, the church sells it tax-free and receives the full value of the gift. If you own stock that has gone down in value you may be able to sell the stock, make a gift from the cash proceeds to your church and apply the realized loss on your 2015 tax return. Again, check with your financial advisor before making any securities gifts or transactions to see which strategies are best. (Many Florida Conference churches are able to receive securities electronically, but if your church does not have that capability, the foundation can assist in making a gift.)
Gifts from your IRA
Congress has yet to act on the current IRA Charitable Rollover provision, and given the political climate in Washington, it is unclear whether legislators will do so in 2015. In past years, legislation was passed very late in the year, but made retroactive to Jan. 1.
If Congress does act, here’s how the provision is expected to work: if you are 70 and a half or older and must take an annual minimum required distribution from your traditional IRA, you may roll over up to $100,000 to your church, the foundation or another qualified charity or charities without recognizing the rollover as income, effectively making it a tax-free charitable transfer.
In order to qualify, the funds must not pass through your hands. Instead, your IRA trustee must send the funds directly to your church or other qualified charity.
Gifts from your will or living trust
Consider a bequest from your will or other estate-planning vehicle. A bequest is a way to “leave your legacy” to your church as a statement of lifelong, comprehensive Christian stewardship. If you already have a will, a simple one-page addendum or codicil is all that is required to make a bequest. If you don’t have a will, I strongly encourage you to have one written, and consider a bequest to your church when you do.
Make a gift now and spread out grants over time
A donor advised fund administered by the foundation enables you to make a tax-deductible gift now and subsequent gift distributions to qualified organizations over time. You make an initial gift to the foundation and then periodically advise how it should be distributed. The fund will be invested and can be expected to grow over time, and you or others may add to the fund at any time. A donor advised fund is a convenient, low-cost alternative to a family foundation. It enables you to advise the foundation to make distributions to your local United Methodist church or other agency or mission, as well as to other qualified charities. And the fund can become a permanent one at the foundation, with children or other family members named as successor advisors upon your death.
Make a gift that will pay you income for life
Life income arrangements, like charitable trusts and charitable gift annuities, combine a gift to your church with income to you or loved ones. These are excellent planned giving alternatives that not only benefit your church, but also include income and tax benefits for you or your family.
Charitable gift annuities are especially attractive now in our low interest rate environment. For example, a 75-year-old can receive an annual return of 5.8 percent on a charitable gift annuity with the foundation. He or she would also receive an immediate tax deduction for a portion of the gift. At the donor’s death, the remaining value of the gift annuity is distributed to his or her church or other qualified organizations. Charitable gift annuities can be for one or two lives.
These are just a few options to consider. What’s most important is not the “how,” but the “why” of our generosity. And it’s not complicated. All we need to do is look to Jesus, and that’s enough.
Please consult with your professional advisor before making a planned gift.
* Wilkinson is the foundation’s vice president of church relations and new business. He can be reached at email@example.com or 863-904-2970, extension 7105.