Every dollar that is given to FPRAZ through a bequest or other testamentary gift is fully deductible for federal estate tax purposes when certain legal requirements are met. An estate tax deduction is allowed for a deferred bequest to FPRAZ even though the bequest provides income benefits to individual beneficiaries

A deferred charitable bequest

If your estate is potentially subject to the federal estate tax, you will want to take steps to minimize the impact this tax can have on your beneficiaries. Happily, there are many time-proven methods of minimizing estate taxes, including both outright and deferred charitable bequests.

Let’s see how a deferred bequest to FPRAZ can minimize estate taxes and add to the financial security of your family and other individual beneficiaries. A deferred charitable bequest can add a great deal of flexibility to your estate planning. With this special form of bequest, you can benefit one or more family members or other individual beneficiaries and provide “deferred” benefits for public radio.

Your deferred charitable bequest can take several different forms, but you can design it to provide an annual income to one or more individual beneficiaries for life (or for a period of years), with the property passing to us or other designated charitable beneficiaries upon the end of the income benefits. The deferred bequest is an excellent tool to provide for dependent relatives and still fulfill your philanthropic desires. For instance, in your will you can direct that a sum of money or a particular property be held in a “charitable remainder trust.” The trustee can be directed to pay an annual income to family members or other beneficiaries for their lives and to distribute the property to us after the deaths of the income beneficiaries.

Example: Mrs. Avery, a 70-year-old widow, wants to make a charitable bequest to memorialize her late husband’s interest to FPRAZ. She has an older sister, however, who needs financial help. By setting up a special trust in her will, she can direct that at her death a certain income will go to the sister for her life, with the remainder interest to come to us as “a deferred bequest” after her sister’s death.

Mrs. Avery is able to ensure support of her sister and to memorialize her husband’s charitable intent. What’s more, Mrs. Avery’s estate may receive an estate tax charitable deduction for the present value of our remainder interest (depending on the type of trust). This is a good example of what you can accomplish with a deferred bequest.

Maximum benefits and personal satisfaction

There are, indeed, many exciting and practical techniques for making a generous gift or bequest to FPRAZ.

We sincerely hope that you will want to include us in your estate plan. Please let us know if you plan to make a testamentary bequest to support our work and activities. We can help you plan your bequest to achieve maximum benefits and personal satisfaction. And, equally important, it will help us plan for the future if we know we can depend on your generous support.

If you would like to discuss any of the gift techniques mentioned in this booklet, please contact us. We welcome the opportunity to discuss with you how your bequest can play a meaningful role in our future and perpetuate your life values. We also will be happy to discuss all of the memorial bequest opportunities available to you.

FOR MORE INFORMATION PLEASE CONTACT
Friends of Public Radio Arizona
2323 W. 14th St.
Tempe, AZ 85281
plannedgift@rioradio.org
(480) 774-8448

Why charitable bequests to Friends of Public Radio Arizona are popular

Bequests, which are gifts made through a will, have been an extremely popular way of providing long-term support for the charitable organizations that are so important in our lives.

There are many reasons donors choose to make bequests to Friends of Public Radio Arizona (FPRAZ):

• The ability to direct support to either KJZZ 91.5 or KBAQ 89.5
• The opportunity to make a statement about personal values.
• The satisfaction of supporting an important cause to benefit future generations.
• The wise financial choices that allow for generous bequests.

Tax planning can also be an important factor in this decision. With some foresight, you can leave a bequest to the radio stations in a way that will permit you to realize other objectives for your estate.

Planning a charitable bequest

Every charitable bequest should accomplish several important objectives:

First: Every bequest to FPRAZ should be a source of great personal satisfaction to you.

Second: Every bequest should be an integral part of your basic estate plan and should complement all of your other objectives.

Third: Every bequest to FPRAZ should provide optimal tax and financial rewards for your estate, your family and other beneficiaries.

It’s Easy to Make a Bequest Through A Codicil

If you now have a will, you can include or update a bequest to FPRAZ through a simple codicil, without the need for executing a new will. A codicil is simply an amendment or addition to your will and is commonly used to add bequests to those already included in your will. Keep in mind, however, that a codicil must meet all the requirements of the laws of your state for the execution of a valid will. Generally, it must be signed by you in the presence of witnesses who must attest to the execution of the document. Certainly, you should rely on your attorney to draft your will and any desired codicils.

Flexibility of planning

Bequests to FPRAZ can take many different forms, so it is important to plan your bequest in a way that will best accomplish all of your estate objectives. Your bequest can be outright or deferred. It can be absolute or contingent upon certain events. It can be restricted to either KJZZ or KBAQ, used for the general support of both stations or designated to a special project or program that you feel is especially important.

And because a bequest can be made through your will, or through a codicil to your will, it is simple to include the station in your estate plan. When you make a bequest to FPRAZ, you retain full use of your property, so there is no out-of-pocket cost, reduction in net worth, or disruption of cash flow. What’s more, you can change any bequest provision, leaving you in control of the process.

Your bequest: Outright or deferred

Typically, a charitable bequest is a direction to distribute a specific asset, or to pay a certain sum of money, to a designated charitable beneficiary. This is an “outright” bequest, the most popular method of benefiting public radio. But a bequest also can be “deferred” with individual beneficiaries receiving immediate benefits and FPRAZ receiving benefits from your estate gift at some later time.

An outright charitable bequest

Many bequests to FPRAZ are for a specific sum of money. The donor’s will simply indicates the amount of the bequest. Alternatively, your charitable bequest can be a specified percentage of the net value of your estate. Under this form of bequest, FPRAZ will share in the increases or decreases in the value of your estate. This form of bequest is often the best way to accomplish your objectives.

Are residual bequests right for you?

It may be that a “residual bequest” to FPRAZ will best accomplish your objectives. The “residue” of an estate is the amount remaining after all costs, debts and taxes have been paid and all monetary and specific bequests have been satisfied. This form of charitable bequest can be especially appropriate if you want other bequests to have priority. For example, if you definitely want specific properties or dollar amounts to go to individual beneficiaries and you want to provide for us only after these priority bequests are paid, a residual charitable bequest may be your best option. You can name several residual beneficiaries and direct how your residual estate is to be divided among them.

The choice is yours

The point we want to emphasize is that, in planning your bequest you have several options.

Your personal objectives should determine the exact form of your bequest. Consult your attorney for advice on your situation. We will be pleased to provide whatever assistance you and/or your attorney may request in planning your bequest.

Financial and tax benefits

Charitable gifts and bequests are motivated primarily by the donor’s desire to provide financial support for a charity. However, tax rewards can also be important. In certain cases, tax benefits can permit you to give more to the radio stations than you may have thought possible.