ALADN 2003 Conference
Michele Fletcher, Director of Library Development
June Steel, Director of Planned and Regional Gifts
Office of University Development
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Why Planned Giving works for
Libraries
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Type of donor is “millionaire next door”
Pattern of small gifts
Donors typically self identify
Donors typically offer clues
Larger payoff
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
“To the rich, the very rich, and the super rich! Have I left
anybody out?”
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
•$250 a year donor
•“Fill-in” appointment
•Highly appreciated
stock with low income
•Interest in planned
giving
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Why Planned Giving is Vital for
your Library
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Aging population
Trillions to be transferred
Millions without wills
Enormous potential
Enormous competition
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Outright
Life Income
Bequest
Planned Giving – Value Added
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Know your donors and prospects
Know your collections
Know about assets
Know about methods
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Investment Cycle
Ultimate
Special
Annual Gift
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
“Would everyone check to see they have an
attorney? I seem to have ended up with two.”
copyright The New Yorker Collection from cartoonbank.com
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Planned Gifts
• Current Gifts
– Stocks
– Tangible Personal Property
– Real Property
• Deferred Gifts
– Bequests
– Life Income Gifts
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Tangible Personal Property
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Charitable deduction for FMV
Related use
Avoids capital gain tax
Self-created works
IRS Form 8283
– Gifts over $500
– Gifts over $5,000
• IRS Form 8282
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
•Real Property
•Life Estate
•Bronze in newly
renovated library
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Real Property
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Full or undivided fractional interest
Environmental issues
Marketability/Carrying costs
Buyer in the wings
Bargain sale
Retained life estate
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
“After 18 years of cultivating Patrick Daniels, III, may I
present his planned gift to us: Twinkles.”
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Wills/Bequests
• Easy to do - often largest gifts
• Types
– Specific
– Residuary
– Contingent
– Testamentary trust
• Removes assets from estate
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
"To whom much is given, of him much is
expected. I have been given much: an
inquiring mind, a sense of ethics, a
lifelong search for religion and truth
(defined as knowledge in agreement with
reality), good health, more than my share
of earth's physical treasures, a reasonable
balance in seeing relationships, and
finally the blessing of a nagging inner
voice to preach, even demand, in strident
tones and at the most inopportune times,
duty, that draconian self-law which binds
one to his principles."
-excerpt from Jack Lynch's will
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Life Income Gifts
• Charitable Remainder Trusts
– Unitrust
– Annuity Trust
• Pooled Income Fund
• Charitable Gift Annuities
– Current
– Deferred
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Charitable Remainder Trusts
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Charitable Remainder Trusts
Benefits:
• Immediate income tax deduction
• Avoids capital gain tax on transfer
• Income for life or term of years
• Removes assets from estate
• Several different types
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Charitable Remainder Trusts
Unitrust
Annuity Trust
Additional
gifts allowed
Variable
income
Assets valued
annually
4 types
Straight
Net income
Net Income +
makeup
FLIP
Fixed
income
No additional
gifts
1 type
Assets valued
one time
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Pooled Income Fund
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Pooled Income Fund
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Agreement between donor and University
Additional gifts can be made - units revalued
Variable income
Managed by University
UNC-Chapel Hill policy:
– cash or securities -- no municipals or real property
– one or two income beneficiaries, minimum age 50
– minimum initial contribution -- $5,000
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Charitable
Gift Annuities
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Current Gift Annuities
Benefits:
• Immediate income tax deduction
• Preferential capital gain treatment
• Attractive rates of return
• Fixed income
• Removes assets from estate
• State regulations vary
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Deferred Gift Annuities
Benefits:
• Same benefits of current gift annuity
plus…
• Payments start when contract stipulates
• Higher payout and deduction since
payments deferred – based on original
gift amount
• Used for retirement income
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Retirement Plan Assets
• Currently
– Lifetime giving has income tax
consequences for the donor
– Asset best given to library at death
• Future?
– Care Act of 2003
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Gifts of Life Insurance
For gift credit the
charity must be both
the owner and
beneficiary of the
policy.
• Donate a paid up
policy
• Donate a partially
paid up policy and
continue to pay
premiums
• Use insurance to
replace asset given
to your library
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
Valentine’s Day Cookies
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL
www.carolinafirst.unc.edu/giftplanning
www.lib.unc.edu
The Campaign for the UNIVERSITY of NORTH CAROLINA at CHAPEL HILL