international medical health organization (imho) business of giving
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International Medical Health International Medical Health Organization (IMHO)Organization (IMHO)
BUSINESS OF BUSINESS OF GIVINGGIVING
Why Give?Why Give?
• Importance of doing/supporting charitable work: humanitarian needs are vast
• Tax breaks
• Avoid estate taxes and probate court
• Turn your charitable vision into a reality!• Start today & see benefits during your
lifetime• Ensure your legacy in the future
Ways you can give to Ways you can give to IMHOIMHO
1. Monetary Donations: Cash, Direct Debit, PayPal
2. Whole Life Insurance
3. Appreciated Stocks
4. Properties
5. Sri Lanka Properties
Ways you can give to IMHO, Ways you can give to IMHO, cont.cont.
6. Sri Lanka Pensions
7. Grant Writing
8. “In Memory of…”
9. Family Foundations
10.Living Trusts
11.Charitable Trusts
Change Your Approach to Change Your Approach to LifeLife
• You Be the Change
• Enlightenment & Awareness
• Philanthropic Forums
• Social Events for Service
• Fun & Fundraising
• Love All & Serve All
UNDERSTANDING YOUR UNDERSTANDING YOUR TAXESTAXES
DURING YOUR LIFE TIME YOU PAY TAXES: INCOME TAXES CAPITAL GAINS TAXES SALES/USE TAXES PROPERTY TAXES GIFT TAXES
UPON DEATH OF BOTH SPOUSES YOU PAY: ESTATE TAXES
Estate PlanningEstate Planning
WHAT: ANY ASSET BECOMES AN ESTATE UPON DEATH
WHY: TO AVOID PROBATE AND SAVE TAXES
WHEN: NOW
Probate CourtProbate Court
PROBATE COURT: SPECIALIZED COURT THAT ONLY CONSIDERS CASES THAT DEAL WITH THE DISTRIBUTION OF DECEDENT’S ESTATE
ANY INDIVIDUAL WHO HAS GENERALLY MORE THAN $100K IN ASSET VALUE WILL END UP IN PROBATE COURT UNLESS THEY HAVE CREATED THE FOLLOWING: 1. FAMILY LIVING TRUST 2. CHARITABLE PRIVATE FAMILY FOUNDATION 3. CHARITABLE REMAINDER TRUST AND/OR
OTHER TRUSTS
Save Save Approx. 25% NOWApprox. 25% NOW
BY CREATING A FAMILY LIVING TRUST AND/OR CHARITABLE FAMILY PRIVATE FOUNDATION YOU IMMEDIATELY SAVE APPROXIMATELY 25% OF YOUR ASSETS BY AVOIDING PROBATE COURT & LEGAL FEES
Living WillLiving Will
A LIVING WILL IS NOT A SUBSTITUTE FOR A FAMILY LIVING TRUST
A LIVING WILL IS A COMPLEMENTARY DOCUMENT TO A FAMILY LIVING TRUST
A LIVING WILL DOES NOT AVOID PROBATE COURT
Gift Tax ExclusionsGift Tax Exclusions
A GIFT HAS TO BE GIVEN BEFORE DEATH BY AN INDIVIDUAL OR FROM THEIR LIVING TRUST
GIFT EXCLUSION IS $1 MILLION PER SPOUSE FOR 2009 THRU 2011 (DURING THEIR LIFE)
GIFT CAN BE GIVEN TO MULTIPLE PEOPLE, BUT LIMITED TO $1 MILLION TOTAL FOR EACH SPOUSE
Estate Taxes ExclusionsEstate Taxes Exclusions
UPON DEATH OF BOTH SPOUSES, THE ESTATE WILL BE SUBJECT TO ESTATE TAXES OF: UP TO 45% IN 2009 (WITH AN EXCLUSION OF
$3.5M) 0% in 2010 UP TO 45-55% (MOST LIKELY) IN 2011
ONE OF THE MANY TOOLS THAT IS AVAILABLE TO REDUCE ESTATE TAXES IS A CHARITABLE PRIVATE FAMILY FOUNDATION
AS AN ALTERNATIVE, CONSIDER A CHARITABLE TRUST
Coping with Coping with Estate TaxesEstate Taxes
TO BUY LIFE INSURANCE FROM YOUR ASSETS IN THE TRUST TO PAY UP TO APPROX. 55% (CAN VARY) OF YOUR ESTATE (I.L.I.T.) TAXES.
RETAIN APPROX. 45% (CAN VARY) OF YOUR ESTATE, OR
RETAIN YOUR LIFE PROCEEDS AND DONATE YOUR ESTATE TO YOUR CHARITABLE PRIVATE FAMILY FOUNDATION AND PAY NO ESTATE TAXES.
A Possible ScenarioA Possible Scenario
ESTATE AFTER EXCLUSIONS= $5M
ESTATE TAXES @45% = $2.25M
LIFE INSURANCE PROCEEDS PAY ESTATE TAXES $2.25M
NET PROCEEDS TO FAMILY $ 5M
Charitable Family Charitable Family FoundationFoundation
CHARITABLE FAMILY FOUNDATION CAN BECOME THE BENEFICIARY OF NET ASSETS IN EXCESS OF ESTATE TAX EXCLUSION, WITHOUT PAYING ESTATE TAXES.
YOUR ADULT CHILDREN OR FAMILY MEMBERS OR ANOTHER “PERSON” (AS TRUSTEES OF THE CHARITABLE PRIVATE FAMILY FOUNDATION) CAN DISTRIBUTE ANNUALLY TO THE CHARITY(-IES) OF YOUR CHOICE.
Filing IRS Form 706 within 9 Months Filing IRS Form 706 within 9 Months of Deathof Death
ALL ASSETS PASS THRU TO THE SURVIVING SPOUSE UPON THE 1ST DEATH: FILE WITH IRS, NO ESTATE TAXES.
UPON 2ND DEATH, ALL ASSETS PASS THRU TO BENEFICIARIES OF THE FAMILY LIVING TRUST:* FILE WITH IRS, PAY UP TO APPROX. 45-
55% ESTATE TAXES ON THE VALUE OF ESTATE AFTER EXCLUSIONS (DEPENDS ON THE YEAR)
Save on Current Taxes through Business Save on Current Taxes through Business of Givingof Giving
DURING YOUR LIFETIME, TRANSFER ASSETS TO YOUR OWN CHARITABLE PRIVATE FAMILY FOUNDATION & SAVE ON INCOME TAX DOLLARS (CURRENT VALUE)
UPON DEATH, ASSETS TRANSFER TO YOUR OWN CHARITABLE FAMILY FOUNDATION & YOU SAVE ON ESTATE TAX DOLLARS
Public CharityPublic Charity
DONATION TO A PUBLIC CHARITY:
YOU RECEIVE A WRITE OFF ON YOUR AGI (ADJUSTED GROSS INCOME)-LINE 31, FORM 1040
CASH: 50%
PROPERTY: 30%
Charitable Private Family Charitable Private Family FoundationFoundation
DONATION TO A CHARITABLE PRIVATE FAMILY FOUNDATION:
YOU RECEIVE A WRITE OFF ON YOUR AGI (LINE 31, FORM 1040)
CASH: 30%
APPRECIATED PROPERTY: 20%
Mission Fueled by VisionMission Fueled by Vision
PUT YOUR CHARITABLE VISION TO WORK WITH CURRENT INCOME TAX DOLLARS.
CONTINUE YOUR CHARITABLE MISSION WITH ESTATE TAX DOLLARS