Planned Giving to Lowell Observatory"About five or six years ago during our meeting with an estate planner, he asked if we had considered a charitable bequest. I think we both had the same thought: Lowell Observatory. The reasons we favored the Observatory were that it has an outstanding reputation, and it’s a relatively small, private institution, which means our money will go farther there.”
-Percival Lowell Society members
When you become a planned gift donor, Lowell Observatory will honor you with membership in the Percival Lowell Society. If you have already made a plan to give to Lowell Observatory in your will or estate plan, please contact us. We realize that with your special gift, you consider us to be part of your family; we want to keep you informed about how your gift will be used and give you the opportunity to tell us of your wishes.
Many of our supporters make charitable gifts by naming Lowell Observatory as a beneficiary in their wills. The federal government encourages these gifts or bequests by allowing an unlimited estate tax charitable deduction. To make a bequest to Lowell Observatory, the following language will be helpful to your lawyer and/or estate planner: I give, devise, and bequeath to the Lowell Observatory the sum of _______ (or otherwise describe the gift or specify a percentage of the estate).
You designate a specific dollar amount, specific percentage, or specific property to Lowell Observatory.
Your estate will pay all debts, taxes, expenses, and specific bequests. The remaining amount - the residue - will be transferred to Lowell Observatory.
You can ask that Lowell Observatory receive all or a portion of your estate only under certain circumstances. For example, you can name Lowell Observatory as a beneficiary of your estate only if there are no surviving close family members. Childless couples sometimes provide for the entire estate to go to the surviving spouse, or if the spouse does not survive, to Lowell Observatory.
Family obligations and the need to provide for retirement, coupled with the high cost of living make it difficult for many people to consider substantial charitable gifts now. But there is a way to have the satisfaction of making a meaningful lifetime gift without sacrifice. In fact, you can get current income tax and financial benefits. It is called a life income gift. You irrevocably transfer some assets to Lowell Observatory now, and in return, you (and a survivor, if you wish) receive income for life. The assets are used to carry out our mission.
By making a life income gift to Lowell Observatory, you will receive the following benefits:
1. A charitable deduction in the year you make the gift for the present value of our right to eventually receive the assets.
2. Your effective yield is increased by substantial income tax savings.
3. Income can be taxed more favorably in some plans.
4. Your probate and estate administration costs may be reduced.
In exchange for your gift of cash or marketable securities to Lowell Observatory, we agree to pay you (and a survivor or other beneficiary) a fixed amount annually for your lifetime. The transfer is part gift and part purchase of an annuity. The rate of return is attractive and the payments are guaranteed for life. There are many types of Life Income Gifts. Here are a few:
Individuals with very large estates can use a charitable lead trust to benefit and pass principal to family members with little or no tax penalty. To establish a CLT, you transfer assets to a trust that provides payments to Lowell Observatory for a term of years. Then the trust principal goes to your children, grandchildren, or others free of, or at greatly reduced, federal gift and estate tax. (Please note that a generation skipping tax [GST] is imposed on large transfers to grandchildren and others who are more than one generation younger than you.)
This is the complement of a charitable lead trust. Here, you establish a trust that names a beneficiary of your choice (yourself, your spouse, your children, as you wish). The trust provides life income to the beneficiaries, with the principal being transferred to Lowell Observatory upon their deaths. The beneficiary pays income tax on the distributions from the trust. Your estate will receive an estate tax charitable deduction for the value of Lowell Observatory’s right to eventually receive the trust assets.
Many individuals today have large qualified retirement plans such as an IRA, 401(k), or Keogh plan. These assets have been growing tax-free for years.
Once the owner begins to receive payments from the qualified plans, the distributions are taxed. The plans are also included in the owner's taxable estate. A retirement plan may be an excellent and strategic source of funds for making a gift to Lowell Observatory. One way to make a gift of your retirement plan is to create a charitable remainder trust through your will. Your IRA assets will be transferred to a charitable remainder trust. There is no tax due because the charitable remainder trust is a tax-exempt entity.
Some Lowell Observatory supporters no longer need their life insurance that was purchased years ago to provide for children or other family members. If that is your situation, please consider donating the policy to Lowell Observatory. You may claim a charitable deduction for approximately the policy's cash surrender value, and the proceeds are completely removed from your estate.