Planned Giving Information

Thank you for your interest in NMWA's Planned Giving Program. Planned Giving is a way to make your support for New Mexico's wild places go farther and last longer. Planned giving is about turning your passion for the Land of Enchantment into both current action and a legacy of support.

Planned gifts are those that require some forethought and planning. But they are also those that can have the biggest impact, now and for future generations.

In this section, you will find information on estate planning and alternative giving plans, such as charitable trusts and remainder trusts.

We encourage you to contact us and discuss options that might work best for you.

If you have already included NMWA in your will or named our organization as a beneficiary of your trust, retirement plan, life insurance policy, or other planned gift, please contact Tripp Killin at tripp@nmwild.org.

We welcome the opportunity to show you the benefits of making a planned gift to support our work. Personal discussions, visits, or written presentations incur no obligation on your part, and, of course, all information discussed is confidential. While we recommend that you meet with your own estate attorney or financial advisor to determine the method of giving that best suits your individual needs, we are happy to answer any general questions that you might have about planned giving. We can also point you in the direction of a professional who can answer specific questions and help identify which technique is best for you.

Making a Planned Gift to NMWA

What is Planned Giving?

The term planned giving is used to describe charitable giving through bequests and trusts. There are many planned giving techniques that can help you maximize the personal benefits of your charitable giving, while allowing you to make a gift that you might not have thought possible.

With careful planning, it is possible to reduce or eliminate income taxes (including capital gain) and transfer taxes (including gift, estate, inheritance and generation-skipping). Planned giving is a tool that can enhance your financial plans and security, while helping NMWA continue our important work on behalf of New Mexico's remaining wild places.

Gifts Within an Estate Plan

Bequest by Will

The simplest and most common of all planned giving methods is the bequest. As part of a will, a charitable bequest specifies that a sum of money or percentage of the estate, or a particular asset, such as a stock or personal property, be given to a charitable organization, such as NMWA, upon the donor's death. Gifts can be made outright at the time of your death or after you make provisions for your spouse or other loved ones.

Advantages:

• Simple part of a will
• Donor retains principal and income during his or her lifetime
• Unlimited tax deduction for the estate
• Revocable at any time
  

Disadvantages:

• No immediate tax benefit
• The bequest must be paid from the estate
• Probate adds costs, delays, and complexity

Living Trusts

A revocable living trust provides you with the flexibility and privacy to manage your estate. It creates a means to manage your financial affairs in the event of future incapacity. You can name your heirs and charitable organization(s), such as NMWA, as beneficiaries of your remaining assets in your living trust after your death.

Advantages:

• Estate tax would be avoided on assets designated for NMWA
• Assets will pass to your heirs and designated beneficiaries without the time and expense of probate
• Revocable at any time
  

Disadvantages:

• Can be misleading (the establishment of a trust does not necessarily mean that your estate planning is complete)
• Donors occasionally forget to transfer their assets into the trust!

IRAs and Other Qualified Retirement Plans

If you are accumulating significant amounts in your IRAs, defined contribution pension plans, or profit sharing plans, considerable amounts may remain in these plans at the time of your death. Retirement plans are often considered the smartest assets to leave to charitable organizations. These assets are unusual in that they are subject not only to estate tax but also to income tax when received by heirs. Heirs often receive only a fraction of the original value after both taxes are levied. Both taxes are avoided when NMWA is named the beneficiary.

Advantages:

• Bequest does not become liability of estate
• Heirs avoid income taxes on charitable gift and can inherit other assets generally free of income taxes (with stepped-up basis)
• Amounts directed to charitable organizations are revocable; beneficiaries or percentages can be changed
  

Disadvantages:

• Specifying a dollar amount may trigger income tax liability to estate (can be avoided by specifying fraction or percentage to charitable organization)

Charitable Life Insurance

You can name a charitable organization, such as NMWA, as the beneficiary of an existing individual or group life insurance policy. Alternatively, you can transfer actual ownership of the policy to NMWA, or purchase a new policy and name us as the beneficiary.

Advantages:

• Excellent way to make a sizable gift to NMWA with modest annual payments
• Policy proceeds will not be subject to estate tax
  

Disadvantages:

• Some donors are uninsurable

Alternative Giving Plans: Gifts That Provide Income for Life

A gift that provides income for life is an excellent way to support NMWA's long-term efforts. When you contribute cash or stock, you can receive payments for the rest of your life. What remains of your gift will be used to protect New Mexico wilderness. In addition to increasing your current income you will also:

Save capital gains taxes: capital gains taxes will be entirely avoided or substantially reduced if you donate appreciated assets to a life income arrangement. Your lifetime income from these arrangements will be based on the full fair market value of assets donated

Reduce your income tax: you will be entitled to an income tax deduction for a portion of the value of your gift

Charitable Remainder Trusts:

Charitable remainder trusts are formal trust arrangements that can help you protect your assets, reduce estate settlement costs, and reduce taxes. Appreciated assets that you donate can be sold and proceeds reinvested without paying capital gains tax. The trust makes payments to you and/or your beneficiaries for the life of the trust or a term of years (not to exceed 20 years). The principal is then distributed to the charitable organization(s) of your choice. The two basic types of charitable remainder trusts are charitable remainder unitrusts and charitable remainder annuity trusts.

Charitable Remainder Unitrust (CRUT)

Donor and/or other beneficiaries receive a fixed percentage of the value of the trust's assets valued annually. The charitable organization, such as SUWA, receives the remainder of the trust at the income beneficiary's death or trust termination.

Advantages:

• Income for donor or other beneficiary at desired percentage, regardless of current investment return
• A portion of contribution is deductible in current year
• NMWA receives remaining assets at donor's death
• Trust is normally tax-exempt
  

Disadvantages:

• More complex to establish and fees are generally higher than some alternatives
• Income to income beneficiary is generally taxable
• Most have individual or institutional trustees
• Some CRUTs cannot accept future donations
  

Charitable Remainder Annuity Trust

Similar to the CRUT, except that instead of receiving a fixed percentage of the trust's assets, the donor receives a fixed dollar amount each year. If you are concerned about the possibility of recessionary times and falling market values, the annuity trust has greater appeal.

Advantages:

• Same as above, except that annual income for donor or other non-charitable beneficiary is fixed amount
  

Disadvantages:

• Same as above, with the exception that charitable remainder annuity trusts cannot accept additional donations. Nonetheless, you can always create a new trust for the purpose of increasing your income.

Charitable Gift Annuity

In exchange for assets, charitable organization guarantees to pay a specified life income payment to beneficiaries. The charitable organization, such as NMWA, receives the remainder at death of the beneficiaries.

Advantages:

• Fixed amount of income provided each year for life
• Part of the income is a tax-free return of principal
• NMWA receives remaining assets at donor's death
• A portion of the contribution is deductible in current year
  

Disadvantages:

• Transfer of long-term appreciated assets gives rise to tax liability to donor

Charitable Lead Trust (CLT)

Assets are placed in a trust, and the charitable organization receives income for the duration of this trust. Property is eventually returned to the donor, donor's descendants, or other non-charitable beneficiary.

Advantages:

• Assets may be passed on to heirs
• Generates income for NMWA during your lifetime or over a specified number of years
• Can provide gift, estate, and generation-skipping tax advantages
  

Disadvantages:

• Tax treatment is complex
• More complex to establish and fees are generally higher than some alternatives

In Conclusion

This information is intended to show only some of the ways that you can benefit NMWA's programs and minimize your tax liability. You should always consult your financial advisor or estate attorney on tax-related matters affecting your specific situation. We welcome the opportunity to supply you with additional information about any of these methods of giving and to answer any questions you might have about NMWA and our work to protect New Mexico wilderness. We would also be happy to put you in touch with a professional who can answer specific questions and help identify which technique is best for you. Thank you for your support!

To learn more about supporting NMWA in a way that makes the most sense for you, please contact:

Tripp Killin
Associate Director
New Mexico Wilderness Alliance
P.O. Box 25464
Albuquerque, NM 87125
Phone: (505) 843-8696
Fax: (505) 843-8697
Email: tripp@nmwild.org