AIP History Center Newsletter
Volume XXXII , No. 2, Fall 2000

 

Friends of the Center for History of Physics

The Physics Legacy Circle

The Physics Legacy Circle was established to recognize those who choose to leave a bequest or planned gift to further the work of the Center for History of Physics. Your planned gift to the Center may be a way for you to meet your personal income goals while leaving a lasting legacy for the benefit of science and the public. With adequate planning you can continue to receive income from a property, provide for a loved one, and receive significant tax advantages for income taxes, capital gains taxes, gift taxes and estate taxes.

Why Help the Center Now and Later?

When asked, "Why did you chose to be a member of the Legacy Circle?" some of the scientists, engineers and historians of science who have joined say that they had benefited from society and the physics community. They want to bring something back to the community as a way to share their success and happiness in their chosen profession. Others talk about their desire to set up a legacy to help make a lasting improvement in the disciplines of science and history. Some realize the importance of supporting the Center and want to provide leadership so that others will be encouraged to help. For these reasons and others, you may wish to join the Physics Legacy Circle.

There are various financial vehicles that you may use to both help the Center and meet your financial goals. Below is a chart that summarizes many of these methods. In this article we will explore Charitable Lead Trusts or CLTs, and Charitable Remainder Trusts or CRTs, that the American Institute of Physics can help you and your financial planner set up to help the Center while providing you with income and tax benefits.

Summary Chart of Several Types of Gifts
(Gift property includes securities, stocks and real estate)
OPTION BENEFITS
Bequests and simple gifts Lessen capital gains, gift and estate taxes
Life payment plans Receive income, defer or lessen taxes
Charitable Gift Annuity The gift property goes to the Center, and AIP agrees to pay you and your family during your life a fixed amount (annuity) based on your age and number of beneficiaries. The rate is established by the National Council for Gift Annuities and favors older donors (immediate tax deduction on gift, tax deduction on annuity payments).

Charitable Lead Trust
(see description below)

The gift property remains with you and your family, income from the property goes to the Center for a selected period of time (tax deduction on property income).
Charitable Remainder Trust
(see description below)
The gift property goes to the Center as a trust, a fixed amount assessed at time of gift goes to you and your family.
Gift of Real Estate with Retained Life Interest Real estate gift goes to the Center, you receive tax benefits and may continue to use the real estate during your lifetime.


Charitable Lead Trusts

In a Charitable Lead Trust, you and your family do not donate the property (stocks yielding dividends, bonds, income generating real estate), but instead donate the income from the property to the American Institute of Physics. The Center becomes the income beneficiary, receiving steady dividends during the lifetime of the contract. At the owner's death or other specified time, your named beneficiaries then receive the bulk of the CLT's assets. CLTs offer current income tax deductions and a reduction of capital gains taxes. Financial institutions can set up and manage a CLT so that the income is shared between the Center and other charities you select.

Charitable Remainder Trusts

Charitable Remainder Trusts have two sets of beneficiaries. The first set are the income beneficiaries, normally you and your family. You receive a set percentage of income during your lifetime from the CRT. The second set of beneficiaries are the Center and any other charities you name. They receive the principal of the trust after the income beneficiaries pass away. CRTs do not evoke capital gains taxes on assets. CRTs are ideal for assets like stocks or property with a low cost basis but high appreciated value. You could set one up during your peak earning years and make contributions in the form of zero coupon bonds, nondividend paying growth stocks, or professionally managed variable annuities. The CRT can continue to grow during those years if you do not take income from it. When you retire, the CRT will provide income to you in relation to its size. Your retirement payout can include makeups for any shortfalls in income you did not receive earlier. Unlike IRAs or 401(k) plans, there are no limits on how much you can contribute.

For more information on Planned Giving or how to support the Center for History of Physics, please contact Natalie Quets at 301-209-3006 or
e-mail chp@aip.org, or visit our Friends Web site.


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AIP History CenterCenter for History of Physics
Email: chp@aip.org
Phone: 301-209-3165
American Institute of Physics 2003 American Institute of Physics, One Physics Ellipse, College Park, MD 20740-3843. Email: aipinfo@aip.org Phone: 301-209-3100; Fax: 301-209-0843