How can a Lion of Judah make a LOJE commitment?
Every woman has a unique family and financial situation. In recognition of different estate planning and tax objectives, a LOJE can be easily and positively designed to match an individual’s person circumstances in a beneficial way. Federation endowment professionals and financial and legal advisors can design a Lion of Judah Endowment that will help donor’s realize their philanthropic visions and, at the same time, meet the required criteria. There are various ways to create endowments, many of which do not have to be funded during a donor’s lifetime.
A LOJE fund is not intended to substitute for any part of a gift to the Jewish Federations annual campaign. A $100,000 endowment is expected to generate at least the Lion of Judah minimum of $5,000, calculated at a yield of 5%; a $200,000 fund will yield a minimum of $10,000; and a $1 million fund will yield a minimum $50,000 annually. LOJE funds are invested and prudently managed for maximum yield.
Vehicles to Fund a LOJE
A LOJE enables you to help secure a strong and vibrant Jewish community for future generations. Endow your gift at your current giving level and ensure that the work you support continues even after you are gone. Find out how easy it can be with examples the different funding vehicles listed below:
Cash or Appreciated Securities
This is the easiest way to create your LOJE. When you create a LOJE with a current gift of cash or other property, your fund may be used to pay your annual gift to the Women’s Campaign. If you donate appreciated securities held for more than one year, you can avoid capital gains taxes and receive a tax receipt for the full value of your gift in the current year.
The most common way to create a LOJE is with a bequest in your will. A charitable bequest allows you to retain use and control over your assets during your lifetime. An outright charitable bequest is deductible and reduces the amount of your estate subject to federal death taxes.
Here is a sample of language you can use:
“I bequeath the sum of [ ] to [the federation (federation address)] to establish the “[donor’s name] Lion of Judah Endowment Fund.” Five percent of the value of the fund is to be used on an annual basis to make a gift to the Women’s Campaign of [the federation].
IRA or Pension Funds
If you have accumulated substantial amounts in your retirement account and you are in the highest brackets for paying income and estate taxes, those taxes can exceed 70% of the amount in the plan. These are not ideal assets to bequeath to your heirs. Naming your federation as the after-death beneficiary of your IRA pension fund can save these taxes while perpetuating your Lion of Judah gift.
Life insurance is an advantageous and inexpensive way to fund a Lion of Judah Endowment, especially for younger women. When you purchase a new policy naming your federation as owner and beneficiary, you will receive a tax receipt for the full value of the annual premium payments. You could also transfer an existing policy and name the federation as owner. At the time of the transfer you are entitled to a current deduction equal to the net cash or replacement value of the policy. All future premium payments, when paid, would be a current tax deduction.
Charitable Remainder Trust & Charitable Lead Trust
A charitable remainder trust provides life income for one or several income beneficiaries, such as the donor and the donor's spouse, and leaves the remainder interest to the federation/foundation, which can be used to perpetuate your Women's Campaign annual campaign gift.
Depending upon the donor's needs, charitable remainder trusts can be used as a personal retirement plan. They can be structured to pay income immediately or to defer the income. Unlike new restrictions on IRAs or amounts that can be contributed to qualified pension plans, there are no such restrictions on gifts that can be contributed to charitable remainder trusts. All the contributions qualify for a charitable income tax deduction.
Other Funding Vehicles
Other options for creating your LOJE include charitable income plans and gifts of property, art, or jewelry. Your financial professional or estate planner can help you select the one best suited for your individual needs and philanthropic desires.