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Gifts that Pay you Income

When considering a contribution to Ballet Arkansas, there's no need to perceive it as a trade-off between your charitable aspirations and financial stability. By opting for gifts that offer you income throughout your lifetime, such as Charitable Gift Annuities and Charitable Remainder Trusts, you can simultaneously support the Ballet's mission and ensure financial security. Potential advantages encompass: Charitable income tax deduction, Augmented income, and Avoidance of upfront capital gains tax.

Secure Your Retirement with a Gift Annuity Strategy

Discover how it operates: Imagine Robert and Emily, both aged 68, are keen to leave a lasting legacy while simultaneously ensuring their retirement income. They establish a $30,000 Charitable Gift Annuity (CGA) with Ballet Arkansas. Given their ages, they qualify for a payment rate of 5.2 percent, resulting in annual payments of $1,560 for the duration of their lives. Furthermore, they become eligible for a federal income tax deduction in the year of their contribution. By utilizing appreciated stock, they position themselves to obtain a federal income tax deduction while also avoiding capital gains tax. Upon the conclusion of their joint lifetime, they decide that the remaining funds will support an endowment to facilitate exceptional training for emerging professionals. Alternatively, Robert and Emily could have chosen a Charitable Remainder Trust (CRT) to encompass a larger portion of their estate. With the CRT option, they would be entitled to lifelong payments, incorporating their heirs to receive payments, and subsequently directing final remainder distributions to Ballet Arkansas, alongside their other favored charitable causes.

Make the most of a Charitable Remainder Trust

By choosing this avenue, you can secure a tax deduction when making your contribution. Subsequently, after a designated time, you or your heirs will gain possession of the trust assets along with any accrued value. Imagine this possible scenario: Jean desires to support Ballet Arkansas while also preparing for retirement. At the age of 50, she comes into a substantial windfall and is seeking a sizeable income tax deduction. Following the counsel of her financial advisor, Jean establishes a charitable lead annuity trust, endowing it with assets valued at $600,000. The trust allocates $30,000 annually to Ballet Arkansas for 15 years. Once this period concludes, the trust's remaining balance reverts back to Jean, aligning with her retirement needs. Jean's generosity translates into an income tax charitable deduction of $484,152. Assuming an average 6 percent annual rate of return, Jean anticipates approximately $818,484 at the termination of the trust term.

Email Michael Fothergill, Executive and Artistic Director at michael@balletarkansas.org to learn more and discuss your options. 

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