For nearly 40 years, Sonoma Land Trust has protected places that make this county extraordinary. By including the land trust in your estate plans, you will help ensure this legacy continues for generations to come.
- Why Sonoma Land Trust?
- Estate Planning Tools
- Gifts that Pay You
- Giving Real Estate and Keeping It, Too
- Tax Benefit Calculations
- Glossary of Terms
Why Sonoma Land Trust?
Your bequest will help Sonoma Land Trust, founded in 1976, to protect the beautiful, productive and environmentally significant land in and around Sonoma County and to conserve additional scenic, natural, agricultural and open land in the future. More specifically, your bequest helps Sonoma Land Trust to:
- Develop long-term land protection strategies,
- Promote private and public funding for land conservation,
- Acquire land and conservation easements,
- Steward the restoration of conservation properties, and
- Promote a sense of place and a land ethic through education and outreach.
We would be honored to enroll you in the Legacy League, so please let us know of your bequest by calling (707) 526-6930 ext. 105 or firstname.lastname@example.org.
Or fill out and mail the form to:
Director of Donor Relations
The Sonoma Land Trust
Santa Rosa, CA 95404
The most common way people remember the Sonoma Land Trust in a will or living trust is through a charitable bequest. You do not have to rewrite your current documents. You simply add an amendment, called a codicil, to your will or living trust. Here is some suggested language you can have your attorney review:
"I give devise and bequeath to the Sonoma Land Trust (tax I.D. #51-0197006), located in Santa Rosa, California, the sum of ________________________________ dollars ($ _______________)
(Or state a percentage of your estate, or describe real or personal property, including exact location) for the benefit of its general purposes (or specify the Sonoma Land Trust program you wish to support).”
Your bequest is entirely under your control during life and becomes irrevocable only at death. If you have questions about bequests, call Sonoma Land Trust planned giving consultant Greg Lassonde at (415) 337-4671 or email@example.com.
We would be honored to enroll you in Sonoma Land Trust’s Legacy League, so please let us know of your bequest by contacting Donor Relations Director Reta Lockert at (707) 526-6930 ext. 105 or firstname.lastname@example.org.
Or fill out and mail the form to:
Donor Relations Director
Sonoma Land Trust
822 Fifth Street
Santa Rosa, CA 95404
Estate Planning Tools
The Sonoma Land Trust can help you get your estate plan done. You can instantly access our basic introduction to estate planning in our clear and concise video series.
The series takes you through the pros and cons of probate, wills, living trusts, advance health care directives, and other basic estate planning tools. You can download a computer-friendly version of our Estate Planning Organizer now.
To order a hard copy of the estate planning organizer or request a computer-friendly version sent to you by email, contact Donor Relations Director Reta Lockert at (707) 526-6930 ext.105 or email@example.com.
Effective estate planning usually takes time, effort and a good attorney. In the end, your plan will allow your family to avoid the delay, dissension and needless expense that often occurs when a loved one dies without a will. Once you have taken care of your family's needs, please consider a thoughtful bequest to the Sonoma Land Trust.
For more information about how to include Sonoma Land Trust in your estate plan, you can contact our planned giving specialist Greg Lassonde at (415) 337-4671 or firstname.lastname@example.org.
Gifts that Pay You
Charitable Trusts are an option for donors who want income for life, bypass of capital gains tax on stock or real estate, reduced taxes and the satisfaction of providing for a good cause like Sonoma Land Trust.
First, a few words about charitable trusts generally. Anything you place in a charitable trust — cash, stock, or real estate — is invested by the trustee to pay you income for the rest of your life and, if you wish, pay your heirs for life or for a term of years. After the death of all income beneficiaries, what remains in the trust passes to Sonoma Land Trust. Your trust may provide you with some important tax benefits:
1) An immediate income tax deduction for a percentage of your gift. We will be happy to give you an idea of the size of your deduction. We simply need to know the ages of the income beneficiary(ies) and the payout rate of the trust.
2) No tax on the sale of appreciated property. From the donor's point of view, this is often the most important tax benefit. Sometimes thousands of dollars that would have gone in capital gains taxes remain in the trust generating income to the income beneficiaries.
3) The trust principal is not subject to estate tax. Property that might otherwise be subject to federal estate tax, which can be as high as 33%, is preserved from estate tax entirely.
Appreciated real estate is often an excellent asset to place in a charitable trust. Mature investment properties are frequently earning only two, three, or four percent of their fair market value per year. When these properties are sold and the proceeds reinvested by the trust, earnings often increase significantly.
Under ordinary circumstances, owners face substantial capital gains taxes when they sell rental properties or commercial real estate. In some cases personal residences are also subject to capital gains taxes even after the $500,000 exemption has been used. In any case, because your charitable trust will be selling the property, there will be no capital gains taxes due when the real estate is sold. Thus the entire net proceeds from the sale can be reinvested to produce more income for you.
Gifts of appreciated stock are ideal for funding a charitable remainder trust because the stock can be reinvested by the trust for greater income while bypassing capital gains taxes at the time of the sale.
Some people find it useful to give an undivided percentage interest of real estate to a charitable trust rather than all of it. For example, a donor contributed 75% of a vacant lot into a charitable trust. When the lot was sold, about $70,000 came directly to her from the sale while $210,000 remained in the trust. Some of her $70,000 was taxable, but she used the income tax deduction generated by her gift to the trust to offset the tax due on the gain built into the $70,000 she received.
There are two basic types of charitable remainder trusts. An annuity trust will pay you a fixed dollar amount for the rest of your life. A unitrust will pay you a fixed percentage of the trust principal each year, so if the value of the trust principal increases over time, your income increases with it. By law, your trust must pay you at least 5% of principal. You may choose a higher payout rate if you wish, but the higher the payout rate the lower your income tax charitable contribution deduction. Also, selecting the highest rate possible may not work in your best interests for another reason. If trust principal declines under the strain of meeting the higher rate, your income will decline with it. On the other hand, a lower payout rate may allow the principal to grow, and your income will grow with it. Additions can be made to a unitrust at any time, but you can contribute to an annuity trust only once.
Finally, your trust must have a trustee. If you have an individual trust tailored to your circumstances, the trustee can be a commercial institution such as a bank or trust company, an individual with professional experience in trust management, a relative, or yourself. There are some complications in acting as trustee yourself, but it can be done if you understand and comply with IRS regulations. Sonoma Land Trust will be happy to supply you with a list of possible trustees or information on being your own trustee.
The basic advantages of charitable trusts are not difficult to understand:
- Diversification of your assets without incurring capital gains taxes
- Lifetime income
- Immediate income tax benefits
- Reduction of estate tax
- The satisfaction of providing for a good cause
There are even ways these trusts can benefit your heirs that we have not covered. But the first thing you should do is find out if a charitable trust makes sense for you.
Sonoma Land Trust will provide you with tax and income calculations tailored to your particular situation. This will give you and your advisors the information needed to make an informed decision as to whether a charitable trust meets your financial and philanthropic objectives. All information is provided confidentially and without cost or obligation. Sonoma Land Trust deeply appreciates your willingness to help continue its work. For a personalized analysis, contact Sonoma Land Trust’s planned giving specialist Greg Lassonde at (415) 337-4671 or email@example.com.
Giving Real Estate and Keeping It, Too
A charitable life estate agreement allows you to give a personal residence or farm to Sonoma Land Trust while retaining the right to live there for life. Donors who enter a life estate agreement receive an immediate income tax deduction. The deduction is based on the present value of the home or farm discounted by the estimated length of time the charity must wait to receive the home. To put it simply, a person age 70 will receive a larger deduction than will a person age 50, all other things being equal.
The IRS grants the deduction even though the donor continues to enjoy full use of the home or farm. But the IRS also expects the owner to have full responsibility for the care and maintenance of the property. That's why life tenancy agreements simply continue things as they are currently, with the donor dealing with maintenance, property taxes, insurance and the like. The major benefits to the donor, then, are continued use of the home or farm, an immediate charitable income tax deduction, the avoidance of probate, the avoidance of estate tax on the property, and the satisfaction of making a substantial gift to the Sonoma Land Trust during one's lifetime. For further information, please contact Sonoma Land Trust’s planned giving specialist Greg Lassonde at (415) 337-4671 or firstname.lastname@example.org.
Tax Benefit Calculations
Sonoma Land Trust can provide you with estimates of the tax and income benefits. These calculations are for educational purposes only and should be reviewed by qualified independent advisers of your choosing. For calculations, please contact Sonoma Land Trust’s planned giving specialist Greg Lassonde at (415) 337-4671 or email@example.com.