1987 Legacy Society

Bequests (specific, residuary, and contingent gifts made by will) are the most popular type of planned gift and will become critical to sustain and expand PSI’s increasing reach. Whether you wish to provide general operating income for PSI to use wherever it is most needed or to support a specific program, your bequest expresses your lasting commitment to supporting perinatal mental health. A bequest to PSI may also help you meet your financial and estate-planning goals since an estate-tax charitable deduction for the entire amount of the gift is allowed. 

Making a bequest is as simple as amending your will to denote the designation. PSI’s Federal Tax ID Number is: 77-0196208. 

Assets in qualified (tax-deferred) retirement plans may represent a large portion of your total assets and therefore may be an important factor in planning testamentary charitable gifts. Retirement assets generally considered suitable for charitable gifts include such plans as IRAs, Keoghs, SEPs, 401(k)s, 403(b)s, and ESOPs.

Left to family members or friends, these assets are subject to income tax and may also be subject to estate tax and generation-skipping transfer tax. Because of this potential double layer of tax, retirement plan assets may be particularly attractive as an asset to leave to PSI. In other words, if you designate PSI as a beneficiary upon your death of all or a specified percentage of a retirement plan, the portion of the plan payable to PSI will generally escape estate taxes, and PSI, as a tax-exempt institution, will not be required to pay income tax on the distributions. As a general rule, if you intend to make both noncharitable and charitable gifts at death, it makes sense to consider using your tax-deferred retirement plan assets for charity and other assets for heirs.

Naming PSI as the beneficiary of an existing life insurance policy that is no longer needed to provide for dependents offers a simple way to support the organization’s mission. Since you are the policy owner, the value of the policy will be included in your estate, but an offsetting estate-tax charitable deduction will generally be allowed. You may also be able to assign an existing whole life policy to PSI, irrevocably making us the owner and beneficiary, and claim an income-tax charitable deduction for the lesser of either your basis in the policy or its fair market value in that year. If the policy is not paid up and additional premium payments are due, you may donate cash or the equivalent to PSI to pay the premiums each year and claim a full tax deduction for the gift. Lastly, you may be able to purchase a new policy naming PSI as owner and beneficiary, pay the annual premiums (through us), and claim the premium amount as a charitable contribution.

Charitable remainder trusts allow you to make a gift to PSI and at the same time retain a benefit from the assets you give. These separately managed trusts can be tailored to meet your financial goals with respect to the payout rate, type of income stream (variable or fixed), and payment schedule. To establish a remainder trust, you make an irrevocable contribution of cash, securities, or other property, which is placed in trust. The trust pays an income stream to one or more named beneficiaries (which can include you) for life and/or for a set term of years (not to exceed 20), and PSI receives the right to principal as a remainder interest. The two most common types of charitable remainder trust are: (1) the annuity trust, which pays a fixed dollar amount each year based on a percentage (at least 5%) of the initial fair market value of the trust assets; and (2) the unitrust, which pays a variable income stream based on a percentage (again, at least 5%) of the fair market value of trust assets as revalued each year. A deferral feature is available for charitable remainder unitrusts. Because charitable remainder trusts (like an IRA or 401(k)) are tax-exempt, this deferral feature can make them a useful retirement planning tool if you are in a position to defer your receipt of an income stream. Charitable remainder trusts are typically funded with assets worth $100,000 or more. Establishing such a trust generally entitles you to claim an immediate income-tax charitable deduction.

A charitable lead trust is the reverse of a charitable remainder trust; the gift to PSI is the income stream from the trust, not the remainder. Charitable lead trusts enable you to provide an income stream to PSI immediately for a set term of years or for a term measured by one or more lifetimes after which the trust assets pass to you or your estate or to your heirs. Leaving the asset to heirs can significantly reduce the gift or estate tax that would otherwise apply.