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Planned Giving

Gifts of stocks, bonds, wills, real estate, life insurance, pension plans, trusts and bequests can be given to Watauga County Habitat for Humanity. Advice from an attorney and other professional advisors should be sought when considering charitable giving. Free consultation with a Habitat lawyer can be arranged for you.

Planned giving is a simple technique that can enable anyone to increase the impact of their support for Habitat and receive tax benefits at the same time. Outlined below are a few of the types of planned gifts that you might want to consider making to Habitat.

Deferred Gifts: Wills
Although Habitat for Humanity of Watauga County needs current gifts to fund its annual goals, the continuity of the organization requires building endowment funds for the future. This long-range view fits well with a form of charitable giving generally referred to as deferred or planned giving. This approach should be considered by those who want to leave a legacy through the organization but do not feel prepared to make a major outright gift at the current time.

The most obvious form of a deferred gift is to name Habitat in one’s will. We certainly hope that many who believe in the mission of the organization will choose to do so. However, although a bequest potentially reduces one’s estate tax at death, there is no lifetime income tax benefit. For this reason, many advisors are recommending other types of planned gifts that provide both income and estate tax advantages.

Charitable Remainder Trust
The most popular form of planned gift is the charitable remainder trust (CRT). Supported by favorable provisions in the tax law, using a CRT can allow one to diversify a highly-appreciated asset tax free, increase one’s cash flow, generate an immediate tax deduction, remove an asset from one’s taxable estate, and have the satisfaction of benefiting Habitat during one’s lifetime.

There are other types of planned gifts that might fit specific circumstances. For example, one can realize substantial estate and income tax benefits by gifting a personal residence or family farm to Habitat, subject to donor’s legal right to retain the use of property for life.

Stocks & Securities
It is also possible to enter into a gift annuity arrangement with Habitat where you transfer cash or securities to the organization in exchange for a promise to pay you a fixed annuity for one or more lifetimes. Many of the same tax advantages mentioned above for CRT are also available with a remainder interest gift or a gift annuity.

Another popular type of planned gift involves life insurance policies. The outright transfer of policy ownership to Habitat results in a tax deduction for the current value of the policy, plus additional deductions if further premiums are paid. What a wonderful way to dispose of policies which are no longer needed for their original purpose.

Charitable Lead Trust
One final type of planned gift is designed for estate planning purposes rather than income tax benefits. The charitable land trust is the “flip” of a CRT, in that the trust makes distributions to Habitat of a percentage of its corpus for a fixed number of years, and then the remainder goes to the donor’s beneficiaries. Depending on investment results, the payout rate and the term of trust, the corpus at termination may be greater than the funded value. However, because of the discounting based on the present value of the charitable interest, the gift deemed to be made at the creation of the trust is only a fraction of that value. Habitat for Humanity of Watauga County will be happy to assist you and your advisors in evaluating the potential benefits available to you when you help endow the future of Habitat with a planned gift.

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