City Tech Foundation
Planning Your Gift
Your gift to New York City College of Technology (City Tech), or to any of its academic divisions or departments, can be an important investment for you and your family, as well as for the College and future generations of its students. Gift planning arrangements at City Tech can generate income for life, yield substantial income tax deductions, convert low-yielding assets into a higher income while avoiding capital gains taxes, and reduce or eliminate estate taxes.
In these and other ways, charitable gift planning becomes an integral part of overall estate planning for you and your family. These gift plans are effective and attractive because they are extremely flexible and can be tailored to your unique circumstances and needs.
On this website, we describe just a few of the ways your contribution can be designed to maximize the advantages both for you and City Tech. We would be delighted to talk with you and your advisor to help you determine which gift arrangements best suit your needs.
Gifts of Cash
Most donors find it convenient to make their gifts in cash by sending a check to City Tech. If you'd like to restrict your gift to a school, division or department of the College, simply enclose a note and we'll be glad to credit your gift as you direct.
Please use the following mailing address:
- New York City College of Technology Foundation
- 300 Jay Street, Namm Hall 323
- Brooklyn, NY 11201
You can call the foundation office and make your gift over the phone, using your Visa or MasterCard (during business hours). The telephone number is 718.260.5025.
We invite you to make your contribution in honor of or in memory of a loved one, and we will acknowledge your gift to that person or that person's family. Simply send your gift to the address listed above. Enclose a brief note specifying the name of the person you wish to memorialize or honor and the address where you would like us to send the gift acknowledgment.
Your cash contribution entitles you to an income tax charitable deduction. You may deduct your total cash charitable gifts for the year for up to 50% of your adjusted gross income (AGI) for that year. If your total cash charitable gifts for the year exceed 50% of your AGI, you may carry over the excess for up to five subsequent years. Of course, you should check with your tax advisor on how the rules apply to your particular circumstances.Top
Gifts of Appreciated Assets
You can make your gift to the College by contributing appreciated assets -- such as stocks, bonds, mutual funds or real estate. Your tax advantages are maximized if you donate appreciated assets that you've owned for more than one year. You obtain an income tax charitable deduction for the full current market value of the asset, and you avoid the capital gains tax that you would have paid if you sold the asset outright.
You may deduct your total charitable gifts of appreciated property for the year up to 30% of your adjusted gross income for that year. If your total charitable gifts of appreciated property for the year exceed 30% of your AGI, you may carry over the excess for up to five subsequent years.
Whether you hold your securities in certificate form or in a brokerage account, we can provide simple instructions on making your gift of appreciated securities -- including stock-transfer forms and a form letter-of-instructions -- to your broker.Top
Gifts of Artwork and Other Items
You can make a gift to City Tech in the form of tangible personal property -- artwork, antiques, books, furniture and the like. Your tax deduction will depend on the type of item you contribute and whether the College will have an appropriate use for it.Top
A Gift through Your Will or Living Trust
Your bequest to the College or any of its schools or divisions, through your will or living trust, can take any of a number of forms. You can bequeath a specific dollar amount or a portion of what remains after your obligations to others are fulfilled. You can designate your bequest to support the College as a whole, or a specific school or division. Through your bequest you can establish a permanent named fund for scholarships, program support, professorships or the like.
A bequest or gift through a living trust yields estate tax advantages while perpetuating your annual support for the College.
You can include City Tech in your will or living trust by using the following language: "I give, devise and bequeath [assets/percent share of the residue of my estate] to New York City College of Technology Foundation, a New York education corporation with its principal office at 300 Jay Street, Brooklyn, New York 11201."
Please call us for additional draft language to ensure that the College and its schools and divisions will fulfill your wishes as you intend.Top
Gifts of Retirement Plan Assets
By naming City Tech as survivor beneficiary of your qualified retirement plan, you can improve your estate's overall tax consequences and increase the amount passing to your children or heirs. A qualified retirement plan works well for saving for retirement, but not for passing assets to heirs. Retirement plan assets are subject to multiple layers of taxation at the owner's death, in the form of federal and state estate tax as well as income tax. As a result, retirement assets are taxed much more heavily than other estate assets. If left to a non-spouse, taxes can claim in excess of 75% of a plan's accumulations.
However, careful planning for the disposition of retirement plan assets will avoid unnecessary tax costs. By naming a charity as survivor beneficiary of your retirement assets, the gift becomes completely exempt from estate tax, income tax and generation-skipping transfer tax, permitting you to make your gift at very low actual cost to your heirs. If you intend to leave a legacy to City Tech or another qualified charity through your will, prudent planning might call for you to make your gift from retirement plan assets instead, leaving the lesser-taxed assets to your family.
Example: John, a widower, is planning his estate. He intends to bequeath $400,000 to City Tech through his will. His daughter is named as survivor beneficiary of his IRA, which contains $400,000. John's gift to City Tech will result in no estate or income taxes. The IRA will pass to his daughter without estate taxes because it falls within the estate unified credit amount, but it will be subject to income tax when the daughter receives it.
At a combined federal and state income tax rate of 35%, the daughter will receive only $260,000 from the IRA. However, if John rearranges his estate to bequeath $400,000 to his daughter through his will, and names City Tech as survivor beneficiary of his IRA, then John’s gift to both City Tech and his daughter will be free of all estate and income taxes. This tax-wise arrangement saves $140,000 in taxes for the benefit of John’s daughter, demonstrating the critical importance of thinking about the survivorship designations of your retirement plans in light of your overall estate planning.Top
Gifts that Pay Income
You can make a gift to the College that will pay you income for life or for a number of years, after which the College will use the remaining gift assets for the purpose you specify.
A life-income gift may be worthwhile if you want to make a gift but need to retain or increase the income you receive from your assets. It can be especially attractive if you own low-yielding but highly appreciated securities, and want to increase your income while avoiding capital gains taxes. And, depending on your age, you can also obtain a substantial income tax charitable deduction when you make your gift.
Several distinct types of life-income gifts are available, providing a flexibility that permits you to fashion a gift arrangement that best fits your financial needs. You can structure your life-income gift to pay income to yourself and another individual or individuals. Your gift can pay a fixed or variable income; it may include tax-free income in whole or part; and you can arrange for the income payments to commence immediately or at a future date, such as your planned retirement.
A charitable life-income plan can also serve to maximize your family's income from the survivors' benefits of your qualified retirement plan. You can designate a charitable life-income plan as survivor beneficiary of your retirement plan. When the retirement assets pass into the life-income arrangement, the income tax is avoided and the estate tax is substantially reduced or eliminated. This combination of tax savings gives the charitable life-income arrangement a larger fund available for investment than if you directly designate your heirs as survivor beneficiaries of your retirement plan, resulting in much higher income for your heirs.
Example - charitable gift annuity: Mary, an alumna who is 75 years old, wants to support the College but needs the income from her assets. She contributes $10,000 and receives a guaranteed income from the College at a rate of 8.2% for the rest of her life. This amounts to an annuity of $820, of which $450 is tax-free. When she makes her gift, she obtains an income tax deduction of over $4,500.
Example - charitable remainder trust: Walter and Amy, ages 77 and 74, want to increase their income from their stock holdings. They own stock worth $250,000, with a cost basis of $100,000. If they sell the stock outright and reinvest the proceeds, they would lose a substantial portion of their investment to capital gains taxes. However, when they transfer the stock to a City Tech life-income trust, they avoid capital gains tax and have the entire value of their asset working to earn income for them. An income rate of 7% would increase their earnings from $5,000 to $17,500. They also receive an income tax deduction of over $100,000.
Example - deferred gift annuity: Lois, age 50, wants to save more for retirement, but she has already contributed the maximum amount for the year to her firm's qualified retirement plan. She contributes $10,000 to City Tech’s deferred gift annuity, directing that income payments commence when she turns 70. City Tech will pay Lois a guaranteed fixed annuity of $2,170, for a rate of return of 21.7%. In addition, Lois obtains an income tax charitable deduction of about $6,000 in the year she makes the gift. With this gift, Lois increases her future retirement income. There is no limit on the amount Lois can contribute to this plan each year, and she can designate when the income payments will commence.Top
Gifts that Pass Assets to Heirs
Another way you can make a gift to the College that ultimately benefits your family and heirs with little or no tax penalty is by setting up a lead trust. It is designed to pay income to the College over a number of years. At the end of the trust term, the remaining principal, including appreciation, passes to your children or to other designated heirs. Because the lead trust generates substantial estate tax savings, your heirs can receive a greater inheritance than if you gave or bequeathed the assets to them directly and fully subject to tax.
A similar type of lead trust can be designed to return the remaining trust assets to you. This type of lead trust generates a substantial income tax charitable deduction for the donor in the year the trust is established. The deduction is based on the income that the trust will pay to the College in future years. This type of trust can be especially helpful in tax planning when the donor desires a large tax deduction to offset an unusually high taxable income in one year.
Example: Annette is aware that current tax laws will substantially diminish the value of her children's inheritance. She transfers $250,000 to a lead trust, instructing the trust to pay 5% each year to City Tech for a period of twelve years. The assets are invested to earn a 10% annual total return. Over the trust term, City Tech will receive a total of $124,000. After twelve years, Annette's children will receive $350,000 from the trust. If Annette had not set up a lead trust, her heirs would receive less than $290,000, based on the current highest federal income and estate tax rates.Top
Gifts of Real Estate
Real estate can be contributed outright or through a life-income gift. You can contribute your personal residence but continue to reside there for the rest of your life. This type of gift of a future interest in your home lets you continue to enjoy your home without diminishing your standard of living, while obtaining a substantial current income tax charitable deduction.
Example: Steven and Ruth, ages 73 and 68, own a home valued at $300,000. They make a gift of the home to City Tech, while retaining the right to live there for the rest of their lives. While sustaining no change in their accustomed life-style, they increase their cash flow, because, based on their current ages, the charitable gift yields an immediate income tax charitable deduction of about $86,000.Top
Gifts of Life Insurance
When properly arranged, life insurance offers an attractive way to leverage relatively low premium payments to make a major gift to the College. If you no longer need all the life insurance that you own, you may want to name the College as a beneficiary or contingent beneficiary. Any benefit the College receives from your insurance will be excluded from your taxable estate.
By taking the additional step of naming the College irrevocable beneficiary and owner of your life insurance policy, you obtain an income tax charitable deduction equivalent to either the policy's cash surrender value or replacement value. If you are the owner of the policy and additional premium payments are due, you can deduct those premiums as charitable contributions each year.Top
For Further Information . . .
The College's Office of Development welcomes the opportunity to work with you and your advisors in planning your gift. We can provide sample language for your review in establishing your gift, as well as calculations and illustrations of the tax and income benefits you may enjoy from it. Your planned gift or bequest helps ensure that New York City College of Technology will continue to provide high-quality education for years to come.