There are many ways to give through the Watertown Community Foundation. Here are some of the most common methods that philanthropists choose.
Cash is the easiest way to contribute. Donors who make gifts of cash are eligible for a charitable deduction in the year the gift is made.
Stocks may be donated to the Watertown Community Foundation as a charitable gift. Donors are eligible for a tax deduction for the fair market value of the stock. By donating appreciated stock to the Watertown Community Foundation, donors can avoid capital gains tax that would otherwise occur at the sale of the stock.
A charitable bequest is the most common form of planned giving. By including a charitable bequest in a will, donors are able to make gifts that are simple, and in many cases, larger than they could make during their lifetime.Â The bequest can take the form of a specific amount of money, or may serve as a residual bequest, where the remainder of a donor’s assets become a gift after all other specific bequests have been paid out. Gifts made to charity by bequest are deducted from the donor’s adjusted gross estate.
Retirement Plans & Life Insurance
Donors can use assets held in an individual retirement account (IRA) 401(k), 403(b), or similar account to start a fund at the Watertown Community Foundation at the time of their death. Donors can choose to donate all or part of their retirement plan to the Watertown Community Foundation. These accounts, while very attractive to defer tax during lifetime, are the most heavily taxed assets in an estate at death.
To make a gift using retirement assets, simply fill out a form with the plan administrator designating the Watertown Community Foundation as a beneficiary. There is no cost, and the beneficiary designation can be changed at any time.
Charitable Remainder Trusts
Charitable Remainder Trusts allow donors to transfer assets to a trust, take an immediate tax deduction and receive an income stream for his or her lifetime. The amount of the deduction varies with the age of the income beneficiary(ies).
Charitable Remainder Trusts are used to guarantee a retirement income while making a significant charitable gift. When a trust term expires, the remainder is contributed to a pre-established fund at the Watertown Community Foundation.
What are the tax benefits?
Both outright and planned gifts have attractive tax advantages for the donor. Donors are encouraged to consult with their tax advisor before making a charitable gift.
What is endowment?
When you create a charitable fund through the Watertown Community Foundation, you have the opportunity to benefit the community in perpetuity with a permanent endowment. Your gift is invested and the earnings from your fund are used annually to address community needs based upon your wishes.
A copy of the Watertown Community Foundation fee schedule is available upon request.
Investment Objectives: It is the intention of the Board of the Watertown Community Foundation to employ policies and guidelines with regard to the investment of the principal endowment which will provide a balance of capital appreciation and generate a reasonable net income to fund activities supported by the Foundation.
Investment Policy: All decisions regarding placement of the funds for investment shall be made by the Foundation Board, subject to any restrictions imposed by donors or grantors.
The assets of the Foundation shall be invested by the trustees with care, skill and diligence under the circumstances then prevailing that a prudent investor acting in a like capacity and familiar with such matters would use in investment of assets in institutions of like character and kind. The trustee banks shall also make investment decisions within the parameters of the Foundation’s Declaration of Trust and the investment policy guidelines established by the Board from time to time.
The Foundation Board shall monitor and review annually the Investment Policy of the Foundation.