Saturday, November 29, 2014

Model Generosity: Leaving a Lasting Legacy Through Planned Giving - Global Church of the Nazarene Foundation in Lenexa, Kansas, United States for Saturday, 29 November 2014

Model Generosity: Leaving a Lasting Legacy Through Planned Giving - Global Church of the Nazarene Foundation in Lenexa, Kansas, United States for Saturday, 29 November 2014
I often find inspiration in the story of the Israelites giving gifts to build the Temple, as recorded in 1 Chronicles 29: "They gave toward the work on the temple of God . . . . Anyone who had precious stones gave them to the treasury of the temple of the Lord" (vv 6-9). Our donors often give generously to help build their local churches, and I'd like to share one account of God's faithfulness.
An older couple, who had tithed to their church faithfully over the years, wanted to go above and beyond and bless their local church with a monetary gift. Unbeknownst to the pastor or church board, they established a charitable gift annuity. Sometime later, the woman passed away, and after a stay in a nursing home, her husband went to be with the Lord as well.
At about the same time, the church was struggling with the challenge of finding money to refurbish their aging building. They were desperate. The board grappled with the question and went to their knees in prayer. The very next morning, the pastor received a phone call from the Church of the Nazarene Foundation, informing them of the couple’s generous gift.
What an amazing story of God’s provision for that church. We’d like to help facilitate giving to your local church as well, to help provide for your ministry through planned giving.
For more information about planned giving through the Church of the Nazarene Foundation, call us at 913.577.2983 or e-mail us at info@nazarenefoundation.org. To read more about our services, visit www.NazareneFoundation.org.
Blessings,
Kenneth R. Roney, J.D.
President

Bonds - Treasuries Rise on Mixed Economic Data
CDs and Mortgages - Interest Rates Stay Low
PERSONAL PLANNER
Bequests to Your Favorite Charity
Bequests to charity are the most popular type of planned gift. A donor may retain assets during life and then leave a bequest to a charity.
A bequest to a charity should include the full legal name, city and state of the charity—particularly if there are chapters of a national organization or religious organizations with similar names. An attorney who drafts the will should be certain that he or she has correctly identified the intended charity by legal name, city and state.
Specific Bequests
Bequests to Your Favorite CharityAs a donor, you may choose to leave a specific item or amount to a charity. For example, some friends of charities have left a bequest of land or property adjacent to the campus of the charity. The usual purpose is for the charity to be able to use that property for future additions or expansion.
If you own art or a specific item that may be used by a charity for its exempt purpose, that asset may be a good choice for a specific bequest. Once again, it is important to identify the exact item and the charity by legal name, city and state. Some donors may also choose to list an alternative gift if they leave a specific bequest. If for any reason your estate no longer owns the specific bequest property at your death, you may wish to designate another item or an amount of cash to the charity.
Another option is a specific bequest of an amount of cash. This allows you to know the exact amount that will be transferred from your estate to charity. There is one planning issue to consider with a bequest of a specific amount of cash. If you transfer a specific amount of cash to a charity and your estate is much larger or much smaller than the present value, this bequest to charity may be a larger or smaller part of the estate than you intend. If this is a reasonable prospect, you may wish to leave a percentage of the estate to your favorite charity.
Gift of Part of the Residue of the Estate
After all of the specific bequests have been made and your estate costs and taxes have been paid, the balance of the estate is called the residue. You probably will choose to distribute the residue on a percentage basis. Many donors decide to leave a percentage of the residue to charity.
Some donors give charity a specific percentage, such as 5%, 10% or more. Another option is to give to all of your charities a share that is equal to the share of your children, nephews, nieces or other beneficiaries.
For example, one donor had two children and divided her estate into three shares. Each child received one share and the charities collectively divided the third share. Another parent with three children divided the estate into four shares and did the same. Treating your charities as one child and simply dividing the estate with one share for each child and one share for favorite charities is a very convenient way to benefit your favorite charities.
IRA or 401(k)
If your estate includes an IRA or 401(k) in addition to your home, CDs and other securities, you might consider a beneficiary designation to charity.
From your perspective, your IRA is a very good asset. For most IRAs, other than a Roth IRA, the plan is funded with pretax dollars. It also grows tax free. However, you or your beneficiary will pay income tax when you withdraw the funds.
For you, the IRA is an excellent plan. Everyone should have a qualified plan such as an IRA, 401(k), or other retirement plan. Your IRA is funded with pre-tax dollars and grows tax free. This is an excellent plan for your future security.
If you pass away with a fairly substantial balance in your regular IRA or 401(k), that could be an excellent opportunity to make a charitable bequest. For the vast majority of Americans who have an estate that is not subject to estate tax, the only tax paid by the family will be income tax. Your home, CDs, stocks and bonds can be transferred to children without tax.
However, if you give family members your IRA, it comes with a large "you-owe-the-IRS" tax bill attached. When children or other heirs receive your IRA, they pay tax at their highest rate on their IRA distributions. This can be a sum of many tens of thousands of dollars.
Therefore, if you are planning to leave assets to charity, the transfer of an IRA may be a good plan.
Joe is an IRA owner and was speaking with his tax advisor Harry about the options for leaving a bequest to his favorite charity.
Joe: "Harry, I've been thinking about leaving a bequest to charity. You know, I've always thought that I would leave most of my estate to my two nephews and three nieces. But as I've thought about it, I have supported my favorite charity for many years and would like to do something for them."
Harry: "Well, you have a home, some CDs, some stocks and bonds and your IRA. Right now, the other assets are worth about $600,000 in total and your IRA is $200,000. How much were you thinking of leaving to the charity?"
Joe: "I thought I would give them about one-fourth of the estate and transfer the rest to my five nieces and nephews."
Harry: "You know, Joe, if you give them the home, stocks and bonds and CDs they will pay zero estate and income tax. But if you give them the IRA, they would have to pay income tax. A better plan might be to give the IRA to charity. Because a charity is tax exempt, it doesn't pay the income tax. In your case, that's a savings of over $60,000."
Joe: "That sounds like a great idea. How do I make that gift?"
Harry: "Your IRA is transferred by a beneficiary designation. We will obtain the form from your IRA custodian and designate your favorite charity. The nice part about a beneficiary designation is that it avoids probate."
Bequest for a Purpose
A bequest of assets through a will, a revocable living trust, or a beneficiary designation of a retirement plan also enables you to select a purpose. In most cases, donors simply leave a bequest for the general purposes of the charity. Because your bequest may occur many years after you sign your will, it is good to give the board of directors of the charity opportunity to select the best and most effective use of the bequest.
However, if you wish to benefit a specific area within your favorite charity, that is perfectly fine. You may designate the purpose for the use of your funds. In selecting a purpose, it is still best to give a general category for the use of the funds, so that the organization can continue to make the best possible use of your bequest.
 
SAVVY LIVING
Personal Tech Products Designed Specifically for Seniors
Savvy SeniorCan you recommend any tablets, smartphones or computers that are specifically designed for seniors? I would like to buy a device for my grandmother so she can keep up with her grandkids better, but the device needs to be simple to use. 
There are several new tech products designed specifically for seniors that are unfamiliar or uncomfortable with technology. These devices come equipped with simplified software, big and vivid features, less clutter and better customer support packages making them easier to use than mainstream devices. Here are several senior-friendly options. 
Smartphone
If you want to purchase a smartphone for your grandmother, check out the new GreatCall Touch3 made by Samsung. This Android smartphone has a 4-inch touchscreen with an organized large icon menu on the home screen that provides users easy access to popular features like the phone, text messages, camera, pictures, contacts, apps, email and the Internet.
The GreatCall Touch3 smartphone has a 5-megapixel camera, a full-size onscreen keyboard and a variety of health and safety features.  One such feature is the 5Star app that lets you immediately speak to a certified agent 24/7 who can identify your location and get you the help you need. Urgent Care provides access to registered nurses and doctors for advice and diagnoses and MedCoach sends medication reminders.
The Touch3 is available at greatcall.com or by calling 800-918-8543. It sells for $170 with a $20 introductory discount, plus a one-time activation fee of $35, and no-contract is required. Monthly service plans that include unlimited 5Star and Urgent Care service start at $25. The data plans start at $2.50 per month for 20MB.
Tablet Computer 
If you’re considering a tablet, AARP’s new RealPad is a top senior-friendly option.  The RealPad costs $189 at aarprealpad.org, walmart.com/realpad or in Walmart stores.
Produced in partnership with Intel, the RealPad is an Android tablet with a 7.85-inch touchscreen. It provides a clutter-free home page with large text icons to frequently used functions like email, social networks, weather, news, games, camera and pictures, the Internet, apps and more.
The RealPad has a 2-megapixel front camera and 5-megapixel rear camera and comes with 24/7 phone support.  In addition, it includes numerous tutorial videos and a “Real QuickFix” tool that connects users to technology support agents over the Internet that can access the tablet and fix any problems.
Desktop Computer 
If your grandmother would like a desktop computer, the Telikin (telikin.com, 800-717-7640), which has been around for three years now, is an excellent choice. Ready to go right out of the box, the Telikin is an all-in-one touchscreen computer that displays a big button menu on the screen at all times.  This menu provides simple access to popular functions such as the Internet, email, games, video chat, photo sharing, news, weather and more.
This desktop is available in two sizes: (1) the 18.6-inch “Telikin Touch” ($699); and (2) the 22-inch “Telikin Elite II” ($1,079). Both versions come with built-in speakers, a Web camera, a microphone, a wired keyboard and a mouse. They also offer a “tech buddy” feature so you can access your grandma’s Telikin computer remotely from your computer to help her when needed.
The Telikin runs on Linux software instead of the standard Windows or Mac OS and is virus-resistant.  It comes with a 60-day trial period, a one-year warranty and free tech support.
It is worth noting that Telikin has a partnership with firstSTREET – a senior product direct marketing company – that is selling the 22-inch Telikin for $1,079, but has rebranded it as the “WOW! Computer for Seniors.”
Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC Today show and author of "The Savvy Senior" book.
 
YOUR PLAN
The Egg Endowment
The Egg EndowmentLet me tell you about a big egg business. Coming out of the military service at the close of the Korean war, Randall decided to put his agriculture degree to work, so he went into the chicken business. Randall and his wife, Janet, put it all on the line. For several years they struggled to make ends meet and finally, during one real desperate business cycle, they decided to turn their chicken business over to God. Janet said they prayed, "Lord, this is your business, do what you will with it." 
God heard their prayers. Over the years, He prospered their labor. They eventually built a very large chicken business with over 16 million chickens housed in various states. They continued to honor God's faithfulness by becoming generous givers and teaching the principles of generous giving to their four children. In 2007, Randall, Janet and some of their family established a substantial endowment fund with the Church of the Nazarene Foundation. This endowment fund will generate income to the local Church of the Nazarene for use in family and children's ministries. The pastor says, "This gift will enable our church to reach into the homes and lives of countless people without negatively impacting our daily operational needs." 
The eggs they gathered over a lifetime will produce far more than a wonderful breakfast. 
 
WASHINGTON NEWS
IRS End-of-Year Tax Tips
Washington HotlineIn IR-2014-110, the IRS offered tax tips for end-of-year charitable giving. 
1.  Household or Clothing Gifts – These items must be in good used condition or better.  A donor must have a contemporaneous written acknowledgement if the gift value of similar items is $250 or more.  The receipt should include a description of the gifted items.  If the similar items are over $500 in value, then an appraisal is permitted and there is no specific condition requirement. 
2.  Gifts of Money – All gifts of money require a bank record or contemporaneous written acknowledgement.  The bank record may be a cancelled check or a credit union statement.  The record should show the name of the charity, the date and amount.  A credit card record should indicate the charity name, the date and the transaction posting date.  A payroll deduction is permitted if the employee retains a pay stub, a Form W-2 or another document provided by the employer.  All gifts of $250 or more require the contemporaneous written acknowledgement.
3.  Timing – Gifts at the end of the year are deductible if deposited in the U.S. mail by December 31st or delivered to the charity by that date.  Credit card gifts are deductible as of the date of the charge, even if paid in the subsequent year. 
4.  Itemized Deductions – Most taxpayers will take the standard deduction and will not benefit from additional charitable deductions.  Taxpayers who have a combination of mortgage interest, state and local taxes and charitable deductions may choose to itemize because the total is greater than their standard deduction.
5.  Tax Records – For all gifts of similar items with value of $250 or more, there must be a contemporaneous written acknowledgement. Gifts of tangible personal property also require a “reasonably detailed” description.
6.  Vehicles – Gifts of automobiles, boats or recreational vehicles are usually deductible at the price received by the charity in a public sale.  The charity is required to provide Form 1098-C to the donor. 
7.  Noncash Gifts – Gifts of property over $500 require filing IRS Form 8283.  Gifts of real estate and similar nonmarketable property valued over $5,000 require a qualified appraisal. 
 
FinancesFINANCES
Stocks - Hewlett-Packard Continues Resurgence
Hewlett-Packard Co. (HPQ) announced its fourth quarter results on Tuesday, November 25. In the midst of a turnaround, the company’s quarterly results were mixed. Revenue during the quarter was $28.4 billion, a decrease of 2% from the $29.1 billion reported during the same period last year. Consensus estimates called for revenue to be higher at $28.7 billion. “I'm excited to say that HP’s turnaround continues on track,” said Hewlett-Packard’s Chairman, President and CEO Meg Whitman. “There’s still a lot left to do, but our efforts to date, combined with the separation we announced in October, sets the stage for accelerated progress in FY15 and beyond.” The company reported earnings per share of $1.06 during the quarter. This was in line with estimates and 5% higher than the $1.01 per share reported last year. For the past couple years Hewlett-Packard has been attempting a turnaround. The company has cut costs and improved earnings. A month ago the company announced plans to split off into two publicly-traded companies. One company will be named HP and will sell computers and printers. The other company, named Hewlett-Packard Enterprise, will contain Hewlett-Packard’s software, services and financial segments. As part of the split 5,000 employees will be laid off. Though Hewlett-Packard’s stock is up 30% on the year, it slid 1% following the earnings announcement. Hewlett-Packard Co. (HPQ) shares ended the week at $39.06. Tiffany’s Third Quarter Results Sparkle Tiffany and Co. (TIF) announced its third quarter results on Tuesday, November 25. The company’s results were slightly below expectations, but that didn’t sour investors on the stock. Tiffany’s net sales during the quarter increased 5% to $960 million, slightly below estimates of $970 million. Comparable store sales during the quarter increased 4%. “We were pleased with overall sales performance, especially in light of economic and geopolitical challenges around the world,” said Tiffany and Co. Chairman and CEO Michael J. Kowalski. “We continue to pursue exciting opportunities in marketing, merchandising and store expansion to support longer-term growth, and are especially encouraged with initial results from the recent launch of our TIFFANY T jewelry collection.” The company reported that net earnings declined 60% during the quarter to $38 million or $0.29 per share. Excluding special items, the company’s net earnings actually rose 5% to $99 million or $0.76 per share.  At first blush, Tiffany’s third quarter results do not stand out in the way investors traditionally look for. All of the company’s top and bottom line numbers missed expectations. However, investors seemingly were pleased with what they saw, especially regarding Tiffany’s 4% comparable store sales growth and worldwide net sales growth of 7%. Along with the earnings announcement on Tuesday, Tiffany’s announced plans to issue a $0.38 per share dividend. Following the earnings announcement Tiffany’s share price was able to temporarily reach a new 52-week high of $110.60 before settling down to around $108 per share. Tiffany and Co. (TIF) shares ended the week at $107.92. Hormel Reports Quarterly Results Hormel Foods Corporation (HRL) announced its fourth quarter results on Tuesday, November 25. The company’s results disappointed as 2015 forecasts fell below expectations.  The company reported that sales were $2.5 billion. This was a 9% increase over the $2.3 billion reported during the same period last year.  “We enjoyed a strong finish to the year, delivering record fourth quarter sales and earnings,” said Hormel Foods Corporation Chairman, President and CEO Jeffrey M. Ettinger. “Our Refrigerated Foods and Jennie-O Turkey Store segments were able to capitalize on growth of value-added sales and higher meat commodity markets to lead the way.” Net income during the quarter was $171.3 million or $0.63 per share. This was an 8% increase compared to net income of $157.3 million reported during the comparable period last year.   Though Hormel released sale and income figures that were roughly in line with expectations, the company’s guidance for next year disappointed investors. Hormel announced that full-year earnings per share guidance would be in a range of $2.45 to $2.55 per share, which was below the $2.59 per share estimate. Projected sales growth was 5%, below estimates calling for projected sales growth of 6%. Following the earnings announcement Hormel’s share price fell 5%, though the stock is up 15% overall for the year. Hormel Foods Corporation (HRL) shares ended the week at $53.02. The Dow started the week of 11/24 at 17,813 and closed at 17,828 on 11/28. The S&P 500 started the week at 2,065 and closed at 2,068. The NASDAQ started the week at 4,725 and closed at 4,792.Treasury prices rose during the week of November 23 as a flurry of economic data indicated the U.S. economic recovery continues to be a mixed bag. The hike in Treasury prices caused the 10-year yield to reach a one-month low. 
The 10-year note prices rose for a fifth consecutive day on Wednesday, November 26. Even though yields have fallen recently, the gap between the U.S. Treasury bond and those of its Group of Seven peers reached 86 basis points, the widest gap since September. As a result, U.S. Treasury bonds have attracted more international investors.
The increasing attractiveness of U.S. Treasury bonds is due to the monetary stimulus of the Group of Seven nations. Speculation ramped up this week that the European Central Bank will increase stimulus that could further reduce bond yields that are already low.
“The search for yield goes on for the time being and Treasuries provide something of a yield pick-up, so that’s definitely a factor in investors’ thinking,” said John Stopford, Head of Fixed Income at Investec Asset Management in London.
The future direction of Treasury yields will be tough to predict if economic data continues to paint a clouded picture. A revised GDP report released Tuesday, November 25 showed the U.S. economy expanded at a 3.9% annualized rate, higher than previously reported. This follows on the heels of a 4.6% increase during the second quarter.
However, as positive as the GDP news was, jobless claims increased 21,000 to 313,000, which was the highest level since September. Other data released this week showed equipment orders fell and that home sales were less than forecast.
The 10-year Treasury note yield finished the week of 11/24 at 2.19% while the 30-year Treasury note yield finished the week at 2.91%.
Freddie Mac released the results of its latest Primary Mortgage Market Survey (PMMS) on Wednesday, November 26. The results show mortgage rates slightly declining this week as economic data was more mixed than expected. 
The 30-year fixed rate mortgage averaged 3.97% this week.  This was a slight decrease from last week when it averaged 3.99%.
This week, the 15-year fixed rate mortgage averaged 3.17%.  This number was unchanged from last week.
Frank Nothaft, Vice President and Chief Economist at Freddie Mac, had this to say about this week’s rates: “Mortgage rates were little changed on the week with the 30-year fixed-rate mortgage declining to 3.97%. This comes during a week of uplifting economic news heading into the holiday; GDP growth was revised up in the third quarter from 3.5% to 3.9%, while existing homes sold at a 5.26 million unit pace in October, topping expectations of 5.15 million units.”
The money market fund finished the week of 11/24 at 0.4%. The 1-year CD finished at 0.7%.
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Are you a Nazarene Legacy Partner (NLP)?  The answer is “YES” if you have designated any gift to a Nazarene ministry in your will, bequest, or estate plan. This could be a tithe on your estate, an insurance beneficiary designation to your local church, college, global mission, or any other Nazarene ministry you support.
Send us your name and contact information by reply email and indicate “I am a Nazarene Legacy Partner” and we will add your name to our NLP honor roll. To model generosity inspires others to do the same. Thank you for your interest in gift planning. To access any of this updated financial and gift planning information, please select our website.
Church of the Nazarene Foundation
17001 Prairie Star Parkway, Suite 200
Lenexa, Kansas 66220 United States
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