Commonly Asked Questions Related to Supporting Simpson

A: Generally speaking, during your lifetime you can make an outright gift of cash, securities or other property (e.g., real estate, personal property). Upon your death you can make a gift through your will or with a distribution from a retirement plan or life insurance policy. You also have the option of making a gift that returns lifetime income to you, your spouse, or other individuals, such as a charitable gift annuity or charitable remainder trust.

A: Almost anything: cash, publicly traded securities, the balance of your retirement account. Other assets can be very valuable but are more complicated to administer, and must be reviewed by us before we can accept them as gifts: real estate, closely held stock and artwork.

A: It depends on the form your gift takes.

Outright gifts to Simpson University generate a full income-tax charitable deduction. Outright gifts of appreciated securities are deductible at fair market value, with no recognition of capital gains - a great tax benefit!

Gifts of personal property, like art, books and collectibles, are fully deductible so long as they are relevant to our mission. We can advise you on this point.

Bequests do not generate a lifetime income tax deduction. They are exempt from estate tax, however.

Life insurance distributions to Simpson University are not income-tax deductible, but are exempt from estate tax. If you have made Simpson University the irrevocable owner and beneficiary of a policy during your lifetime, however, you may deduct annual gifts that offset premium payments (for more details on this point, see question 5 below).

The charitable deduction for a gift that returns income to you, such as a charitable gift annuity or a charitable remainder trust is the fair market value of the gift asset minus the present value of the income interest you retain.

A: No. State law, the limitations of our corporate powers, and our internal policies prevent us from taking such a role in your affairs.

A: New legislation gives donors aged 70½ and older an opportunity to direct lifetime distributions from their IRAs to us without incurring income tax liability on the withdrawal. The provision will be in effect for just the 2006 and 2007 tax years. Distributions can total $100,000 per year, and must be made outright — they cannot fund a life-income gift. Just e-mail us and we'll be happy to give you more information about this new charitable incentive.

A: No, we can't. The IRS requires that donors of artwork and collectibles secure an independent appraisal of the items to establish fair market value. The appraisal has to be related to the gift, too - an insurance appraisal won't suffice. We can assist you on this point.

A: Your charitable gift annuity will be treated as a general obligation of Simpson University, backed by all its assets. We have an unbroken record in making timely payments to our annuitants, and that ongoing responsibility is a key element in our financial policies.

A: We are grateful that you have named us as beneficiary. The charitable portion of your gift is deductible for income tax purposes (see question 3 above). Because our interest is not irrevocable, however, we cannot give you gift credit until our remainder interest is payable or made irrevocable.

A: No. The IRS would not consider that a "completed gift" - they'd say that, as the owner of the policy, you could change the beneficiary designation to a friend or family member. Simpson University must be made the irrevocable owner of the policy for gifts offsetting premium payments to be deductible.