Ways to Give

The Millennium Club

The objective of the Millennium Club program is to grow an additional $25 million in the endowment for scholarships in the next 10 years. Once completed, this endowment will generate an estimated $875,000 in additional financial aid for the students of Northwestern Oklahoma State University every year. This will almost triple the amount the Northwestern Foundation is currently providing in scholarships.

The Millennium program has three categories of giving: Platinum, Gold and Silver. The Northwestern Foundation is grateful for everyone's participation and will recognize that participation with a complementary plaque and coin. Additionally, individuals will be repeatedly recognized in sports programs and other publications the University and Foundation publishes. It is only through everyone's participation that this program will be successful. If a person has a desire to give, he or she can generally participate at some level. Participation in the silver level figures out to be a mere $8.33 per month.

Will Bequests

By naming the Northwestern Foundation in your will, you also will receive an estate tax deduction for the value of your bequest. With proper planning you also can determine the use of the funds you are gifting through your will.

Charitable bequests often are recommended by professionals for donor's consideration as part of their estate planning. Donors are encouraged to obtain legal and financial counsel in developing estate plans, or preparing and executing wills, codicils and trusts.

Three Basic Types of Bequests
1. A specific request conveys a particular piece of property (e.g., a rare coin collection or shares in a corporation) or a stated sum of money.
2. A residual bequest conveys part or all of what remains of an estate after all debts, taxes and administrative costs have been paid and specific bequests have been distributed.
3. A contingent bequest takes effect only if the primary intentions of the testator cannot be met (e.g., if a primary beneficiary dies before the testator).

Charitable Remainder Unitrusts

Charitable remainder unitrusts entail irrevocable transfers of assets to a trustee (often the charitable organization itself), which administers the trust and makes the required payments.

Payments made to income beneficiaries are determined by applicable tax laws and are equal to a fixed percent of the trust's value, which is valued annually. Trusts may specify payments for the lifetime of the beneficiaries or for any period of time up to 20 years. The donor gives the remainder interest to the Foundation.

The Foundation will act as trustee or successor trustee if named sole beneficiary of the trust.

Criteria for Participation

When the Foundation acts as the trustee:

• Initial gift of $100,000
• Payment percent is negotiated with each donor and varies based on donor's needs and beneficiary's age.
• Additions: Allowed if trust document includes a specific provision for valuing additions.
• Gift acceptance policies for individual types of assets apply.

When the Foundation is not the trustee:

• No minimum gift amount is required to set up a trust except as required under tax laws and regulations.

Charitable Remainder Annuity Trust

Charitable Gift Annuities (CGA) can be funded with cash or from the sale of securities, real estate or other personal property. The Foundation, in return, guarantees a fixed return of principal and interest for the remainder of the donor's life.

The charitable gift annuity is a special type of agreement designed to provide a donor with the benefits of a traditional annuity while giving to charity. In exchange for a gift of cash or securities, the donor receives annuity payments from a charity for life. In case of a deferred annuity, the lifetime annuity payments start at some future time of the donor's choosing.

Typically, the donor receives an income tax deduction equal to the gift given to charity, less the present value of the lifetime annuity payouts. Each annuity payment to the donor is generally partially income tax free. If the gift is a long-term capital gain asset, the annuity payouts the donor receives may be partially income tax free, partially taxed as ordinary income and partially taxed as long-term capital gain.

Charitable Lead Trust

Donors utilizing this vehicle are allowed to give the Foundation the income from a trust either for a specific number of years or for lives of named individuals. Meanwhile the donors retain trust assets for themselves or other non-charitable beneficiaries, usually family.

Charitable lead trusts are more attractive in periods of low interest rates. A CLT works as follows: a donor funds the trust with an asset (preferably assets expected to appreciate); the Foundation receives a fixed annual payout from the trust, and the remainder goes to the donor's beneficiaries at the end of the Foundation's payout term.

Unilke charitable remainder trusts, CLTs are not tax-exempt entities. Depending on the type of CLT:

• The donor may be able to take a charitable income tax deduction at the time he or she makes the gift.
• Either the donor or the trust must pay capital gains tax when the charity sells the trust assets.
• The donor or the trust must pay income tax on any income generated in the trust

Donor Advised Fund

A donor-advised fund provides a flexible way to give donations to nonprofit organizations. The donor makes an irrevocable, nonrefundable contribution of cash or securities to the fund. He or she can direct the fund's administrator as to which qualified organizations grants should be made, the amount of the grants and when the grants should be paid. A donor can also appoint a family member or friend to continue making grants from a donor-advised fund after the donor's death.

Assets in a donor-advised fund are typically managed by a professional investment advisory firm. This provides donors with the opportunity to increase the value of their contributions to the fund, resulting in potentially larger grants to nonprofit organizations. Donors are often entitled to a charitable income tax deduction for the amount contributed to a donor-advised fund, subject to AGI limits. Any unused portion may be carried forward for up to five years.

Securities and Gifts

Significant tax advantages are available when a donor contributes stocks, bonds or other types of securities. In many instances this type of giving allows the donor to avoid paying capital gains tax. Gifts of appreciated securities or stock can be one of the most advantageous ways of giving. The donor receives a tax deduction for the market value on the date that the gift is given.

Publicly Traded Securities

Definition: Marketable stocks, bonds and mutual funds.
Policy: Securities typically sold after receipt.

• Donor notifies the Foundation of donor's name, name of stock or bond, number of shares or bonds face value, intended transfer date, intended use of gift.
• Send notification prior to/concurrent with transfer.
• Valuation is the average of high and low stock price on gift date.
• Gift Date is determined by postmark, date of hand delivery, or broker transfer to the Foundation if stock is in donor's name or by date on stock certificate if reissued to the Foundation.

Note: Policies are in accordance with U.S. IRA regulations.

Closely Held Securities

Policy: Donors of securities not publicly traded must first obtain an outside appraisal of the gift.
Sending Gifts: Send independent appraisals to the Foundation, including name, address and intended use of the gift. Proposed gift will be reviewed by the
Foundation and a determination will be made.

Life Insurance

Life insurance provides significant leverage when giving it to the Foundation, making it possible to gift a significant amount at a relatively small cost. A donor can either:

• Purchase a life insurance policy and name the Foundation as the beneficiary
• Give the Foundation a policy previously owned, or
• Give the Foundation cash to purchase a life insurance policy in the Foundation's name.

The donor can receive an estate tax deduction for that portion of the death benefit going to the Foundation.

If the donor transfers ownership of a life insurance policy to the Foundation during lifetime, the donor would receive a charitable income tax deduction, subject to AGI limits, equal to the policy's fair market value or the net premium the donor has paid, whichever is less.

Another choice is to gift cash that the Foundation can use to pay premiums on a life insurance policy, on the life of the donor, but owned by the Foundation. The Foundation would also receive the death benefit, while the donor would receive a charitable income tax deduction for the gift of cash, subject to AGI limits. Some states require the charity to have an "insurable interest" in the donor's life, for example, if the donor is a member of the Foundation's board.

Real Estate

The Foundation may accept gifts of real property in accordance with its environmental policy.

At the time of the gift, a donor may be eligible for a charitable income tax deduction equal to the fair market of the real estate, subject to AGI limits.

If a donor is living in the real estate property, it can still be gifted to the Foundation during the owner's life, with the donor retaining the right to use the property until death. A current deed can be created that transfers ownership of the property to a charity when the donor dies. When the deed is recorded, the donor is entitled to a charitable income tax deduction for the fair market value of the property, less the value of the donor's right to use the property for the rest of his or her life. The fair market value of the property at the donor's death is excluded from his or her estate.

The Foundation may require the following items in order to review a gift of real property:

• A preliminary title report clear of unacceptable encumbrance.
• An appraisal by a qualified appraiser.
• A phase one environmental audit indicating that ownership will not expose the Foundation to environmental liabilities.

The necessary review for evaluation of real estate gifts could lengthen the acceptance process.

Gifts of Cash

Gifts of cash can be made to benefit Northwestern by writing a check payable to the "Northwestern Oklahoma State University Foundation." Typical cash gifts are those made to join the Foundation's giving programs such as the newly introduced "Millennium Club."

A cash gift is still the most popular way to make a charitable contribution. You not only benefit from the tax deduction but also have the chance to see your gift enhance Northwestern during your lifetime.

Scholarships are endowed when the funds reach $10,000 and above. If you choose to endow a scholarship, the donor may name the scholarship, designate the area where it is to be used and help to determine the criteria for selection.

Endowed chairs and lectureships are also named and the academic area designated by the donor.

Gifting money to a capital campaign helps raise significant amounts of money within certain time frames, and often for specific needs. A major reason behind the decision to contribute may be a commitment to the organization or the specific purpose of the campaign.

Various types of assets, including cash and securities, can be donated to charity as direct gifts.

Gifts of Tangible Personal Property

Many donors decide to give tangible assets, such as art and jewelry, to charity. If highly appreciated, the asset can be a substantial gift to charity while providing considerable tax benefits to the donor.

Charitable deductions for these assets are based on whether a gift is related to the purpose of the charity to which it is given. A donor is entitled to a charitable income tax deduction for the fair market value of the asset if the gift is related to the Foundation's mission.

Gift and estate tax deductions are allowed for the fair market value of the asset, regardless of whether the gift is related to the Foundation's mission. The estate tax deduction is allowed if a donor makes a gift of tangible assets through a will or revocable trust.

Gifts must be:

• Accompanied by a qualified appraisal, a photograph and supporting material, such as authentication papers; and
• Of sufficient interest to the University in its normal course of business to further the mission of the University.

Matching Gifts

Many corporations match employee gifts up to three times the original amount given. By providing the Foundation with the proper return forms, your gift can be maximized by taking advantage of corporate matching gift monies.

More than 9,500 corporations and foundations across the U.S. match employee contributions to educational institutions. Most matches are dollar-for-dollar, effectively doubling - or in some cases even tripling - the value of the gifts that alumni and friends make to the Foundation.

Some companies match gifts of retirees and spouses as well as those of active employees.

If the donor's employer matches charitable contributions, obtain a matching gift form from the employer and send it completed and signed to the Foundation with the donor's gift.