How to plan your support for Boca Ballet Theatre

Boca Ballet Theatre’s planned giving programs enable supporters to make substantial gifts to Boca Ballet Theatre in ways that complement their personal financial planning. A planned gift to Boca Ballet Theatre can help donors generate lifelong income, obtain significant income tax deductions, reduce or eliminate estate taxes, and convert low-yielding assets into a higher income stream at a reduced capital gains cost.

Some of the more common planned giving vehicles are summarized below. We are happy to meet with supporters and their financial advisers to help tailor giving strategies that best meet supporters’ needs.

Outright Gifts

Gifts of Securities

A gift of appreciated securities (stocks, bonds or mutual funds held for more than one year) is often the most prudent and economical way to give. Owners of appreciated assets can obtain substantial tax benefits by transferring those assets directly to Boca Ballet Theatre. Donors will receive an income tax deduction equal to the fair market value of the stock on the effective date of their gift, and they will avoid having to pay capital gains taxes on the appreciated value of the stock.

Real Estate

Boca Ballet Theatre accepts gifts of real estate from donors. The owner of the property is entitled to an income tax deduction based on the appraised value of the property. Boca Ballet Theatre carefully examines each piece of real estate prior to its acceptance as a gift in order to reduce the possibility of liability issues related to the property.

Gifts of Securities

A gift of appreciated securities (stocks, bonds or mutual funds held for more than one year) is often the most prudent and economical way to give. Owners of appreciated assets can obtain substantial tax benefits by transferring those assets directly to Boca Ballet Theatre. Donors will receive an income tax deduction equal to the fair market value of the stock on the effective date of their gift, and they will avoid having to pay capital gains taxes on the appreciated value of the stock.

Bequests

Bequests to Boca Ballet Theatre can be made in the form of a specific gift of cash or property or as a percentage of the remainder of an estate. Boca Ballet Theatre may be named as the primary or secondary beneficiary, providing donors the opportunity to provide for their heirs first and Boca Ballet Theatre second.

Life Insurance

The large cash value resulting from a relatively small premium makes a life insurance policy an attractive planned gift. A gift of life insurance may be made in one of three ways: you may donate a fully paid-up policy, naming Boca Ballet Theatre irrevocable owner and beneficiary; you may donate a policy on which premiums are still owed, naming Boca Ballet Theatre irrevocable owner and beneficiary; or you may purchase a new policy and name Boca Ballet Theatre irrevocable owner and beneficiary. Each option has different tax benefits.

Gifts of Retirement

Assets By naming Boca Ballet Theatre as the primary or secondary beneficiary of their retirement plans – IRA, 401k, 503b, etc. – donors can reduce or eliminate income and estate taxes and increase the amounts passing to their heirs.

Charitable Gift Annuities

A charitable gift annuity is a contract between Boca Ballet Theatre and the donor, providing for the payment of life income at a fixed rate for one or two lives. [The pay-out rate increases with the age of the beneficiary(ies).] The donor receives an income tax deduction in the year of the gift and a portion of each payment is treated as tax-free income. A gift annuity may be established with a low minimum gift of $10,000, making it an affordable option for many donors. With a deferred gift annuity, income payments do not begin until a future date, chosen by the donor. The longer the delay between the creation of the deferred gift annuity and the commencement of payments, the larger the income tax charitable deduction. (Gift annuities may not be available in all states.)

Pooled Income Fund

A pooled life-income fund operates like a mutual fund. Your gift of cash or securities is pooled with those of other donors and invested. The primary objective of the investment is to generate income and the secondary objective is capital growth. All of the fund’s net income is paid out to the beneficiaries in proportion to each donor’s share of the Fund’s principal. The rate of return of the pooled income fund varies from quarter to quarter, depending on the earnings of the fund. All income paid from a pooled income fund is taxed as ordinary income to the beneficiary(ies). Donors who contribute marketable appreciated securities to the pooled income fund will avoid capital gains tax on the transfer.

Charitable Remainder Trust

To create a charitable remainder trust, the donor transfers appreciated assets, such as real estate, publicly traded stock or closely held stock, to a separately managed trust that provides the donor and/or a beneficiary(ies) with an annual annuity payment for life or for a specific period of time. At the end of that period, the asset in the trust passes to Boca Ballet Theatre. The donor may decide the exact payout of the trust in consultation with the trustees, who are selected by the donor. The donor may choose to receive a fixed dollar amount from the trust every year or he/she may choose to receive a fixed percentage of the trust assets, which would be revalued annually.

Charitable Lead Trust

A charitable lead trust enables a donor to support Boca Ballet Theatre now while preserving a large portion of his/her estate and passing the assets tax-free to him/herself or his/her heirs. The trust holds income-producing assets for a fixed period of time (which can be the donor’s lifetime), during which income is paid to Boca Ballet Theatre. At the end of the trust term, the assets are returned to the donor or his/her beneficiaries. To discuss planned giving options, please contact Dan Guin at 561.995.0709 x223 dan@bocaballet.org.