Planned Giving

Giving and Receiving

What if you could support Maine Maritime Academy and receive income in return? Through certain Planned Gifts, you can do just that. Life Income Options mean that a charitable gift to the future of Maine Maritime Academy can also generate income for the giver, or someone they choose, and may also provide several tax and income benefits.

Planned Giving is an opportunity to forge a long-term partnership with Maine Maritime Academy. Rather than simply making a donation, or waiting until your estate is settled, you can begin your charitable legacy now, by working with us to craft a plan to benefit both Maine Maritime Academy and your family, for the remainder of your life.

Remainder Trusts

Two key Life Income Options come in the form of trusts: the charitable remainder annuity trust and charitable remainder unitrust. Both of these trusts offer, in exchange for putting property or capital into trust, a lifetime income for the donor or other income beneficiary, as well as a chartable income tax deduction and potential estate tax savings.

Charitable Remainder Annuity Trust

The charitable remainder annuity trust is designed to guarantee a fixed amount of income every year, regardless of how the trust performs. This fixed amount, at the time the trust is funded, must be at least 5% to 7% of the initial market value of the gift given into trust. Once the income amount is set, it is permanent. No further gifts may be added to this annuity trust once the trust is set up. The fixed nature of this trust is its key limitation, but for many donors, it is also its strength, as it guarantees a certain return. Those who choose this trust prefer a predictable, steady amount of income. Annuity trusts are particularly well-suited for gifts of long-term, tax-free bonds. Donors enjoy a tax deduction based on the present value of the trust and avoid capital gains tax when the appreciated property held in trust is transferred. When a trust has run its course, either at the end of the donor’s life, or a fixed term up to twenty years, the remaining value in the trust passes to Maine Maritime Academy.

Charitable Remainder Unitrust

With a charitable remainder unitrust, the donor enjoys a charitable income tax reduction, as with the remainder annuity trust, and avoids capital gains tax on the transfer of long-term appreciated property. And the donor of the unitrust sets a fixed percentage rate at the start of the trust (of at least 5% of the net fair market value of the property held in trust), as with the annuity trust. The key
difference is the annual payout from a unitrust can vary from year to year. If the trust’s assets increase, the donor receives a larger payout. This trust is a good option for those who would rather have a hedge against inflation than a predictable, stable stream of income.

Another distinguishing feature of the unitrust is that you can make additional contributions to the trust after it is established. The unitrust may produce higher amounts of income than an annuity trust, but may also provide a smaller tax reduction. Unitrusts are often established for very specific personal requirements, such as meeting the special needs of a loved one or even to finance a family member’s education.

As with the annuity trust, the remaining value of the unitrust passes to Maine Maritime Academy when the trust has run its course–either at the end of the donor’s life, or a fixed period of up to twenty years, depending upon how the trust was designed.

Charitable Gift Annuities

Trusts are not the only way to give to the Academy and receive income. With a charitable gift annuity, you enter into a contractual relationship with MMA in which you give property or capital in return for guaranteed annuity payments for life. Payments can be made to you, a specified beneficiary, or both (payments are limited to a maximum of two people). The gift you make can be cash or securities (such as stocks or bonds), or even land or other property. The payout depends on the age and number of beneficiaries.

Donors who prefer income payments to begin immediately often choose an immediate charitable gift annuity that begins making payments within one year of the gift date. Donors who are still working, and have sufficient income, often opt for a deferred charitable gift annuity, in which income payments begin more than a year after the gift date (such as retirement age).

Tax benefits of a charitable gift annuity include the ability to immediately deduct a portion of the gift from your taxes. Anuity payments to you and/or a beneficiary are not taxed as ordinary income, but, rather, as a mix of ordinary income, tax-free income and capital gains income.

---

Planned Giving means personalized giving through a plan that works to benefit you, your family, and Maine Maritime Academy. Through a carefully composed plan, such as the Life Income Options mentioned here, we look forward to entering into a partnership with you, from which we all prosper.

For a personalized illustration of how one or more of these gift arrangements would look for you, please contact the Advancement Office at 207-326-2232 or by email at christopher.haley@mma.edu.

 

Your Will

What Will Your Will Support?

The answer to that question is complex and varied for many. Understandably, designated heirs—typically family—are the top priority for most, but what about the organizations and causes to which you’ve charitably given during your lifetime? Many people desire to leave a charitable legacy in addition to providing for their heirs. A charitable bequest is an easy way to continue your legacy with organizations in which you believe.

On a Quest for the Appropriate Bequest

If you wish to charitably honor family members, friends, or organizations you believe in, bequests are a means by which to establish specific objectives for doing so in your will. We list the four main types of bequests commonly made in wills below. You can implement any, or all, of the bequests that are relevant to your intentions. For instance, if, at present, you do not wish to specify a gift amount to Maine Maritime Academy in your will, you can use residual or contingent bequests as other options for philanthropic giving.

Specific Bequest

Specific bequests communicate precisely what you will leave to a person or institution. This type of bequest guarantees specific item(s), property, cash, or securities will be dispersed to specific heirs and describes in detail the exact amount and source they will come from.

General Bequest

A general bequest is also used to leave a specific sum or percentage of money in an estate to an individual or organization; however, it doesn’t spell out where that money should come from. If you want the executor of your will to have the flexibility to honor your bequest from whatever resources are available, this type of bequest may be more preferable.

Residual Bequest

A residual or residuary bequest can be utilized to leave whatever is remaining of your estate to one or more recipients after all specific and general bequests have been fulfilled and all debts, expenses, and taxes have been paid.

Contingent Bequest

A contingent bequest comes into play only if certain circumstances come to pass. Through this type of bequest, you can ensure a specified contingent beneficiary will receive your bequest should your primary beneficiary not survive you, refuse your bequest, or be unable to receive it.

Beneficiary Designation

A bequest is usually included in a Will or Trust document. But there is another way to support MMA at the time of your death. Consider designating MMA as a partial beneficiary of a life insurance policy, an IRA or other retirement account, or an annuity contract. A beneficiary designation will cost nothing today but can allow you to make a significant gift when these assets are no longer needed.

Benefits of Charitable Bequests

Leaving a charitable bequest to Maine Maritime Academy could simultaneously help your heirs. Beyond satisfying your own personal philanthropic goals, charitable bequests provide estate tax charitable deduction opportunities to lessen tax burdens for your heirs.

Sample Bequest Language

“I bequeath [dollar amount or percentage of estate to be donated] to Maine Maritime Academy, a nonprofit corporation, as described in section 170 (c) of the Internal Revenue Code, and existing under the laws of the state of Maine (tax identification number 01-6000724), with a current address of 1 Pleasant Street, Castine, Maine, 04420, and a current telephone number of 207-326-2232.”

THANK YOU

Thinking about how to provide for, and honor, family, friends and organizations that are important to you, posthumously, can be difficult. Thank you for your consideration of a bequest to Maine Maritime Academy.

---

The Legacy Society recognizes those who support Maine Maritime Academy through a bequest, living trust, gift of life insurance or retirement plan assets, or with a life income arrangement.

We are grateful to those who have joined The Legacy Society. These funds contribute to the long-range financial stability of the Academy.

To learn more about how to join The Legacy Society, please contact the Development Office at 207-326-2232 or by email at christopher.haley@mma.edu.