The Password You’ve enTered Is IncorrecT

To complicate matters, most people change their passwords frequently and rarely

use something obvious. Meanwhile, most estimates show that the average Internet

user has as many as 20 passwords.

While numerous services can safely secure your passwords in an “online vault,”

they can be limited. In many instances, some online terms of service may prevent

you from transferring accounts to other people. There is also this consideration:

What if the online security company goes out of business? Storing your passwords

in your will isn’t a good idea either since passwords can change often and a will

becomes public record, which can potentially put your assets at risk.

4 Steps to Organizing Your Digital EstateSo what can you do to help your heirs? Take the four steps listed below to make

the passing on of your online legacy less hectic for your loved ones.

1. Identify all of your online assets—email, Facebook, PayPal, bank accounts, etc.

2. List the usernames, passwords, and security questions and answers, along

with the accounts, on a computer spreadsheet that can be easily updated.

The list should be stored on a USB flash drive or CD or printed and

placed in a safe location such as a fireproof safe or safe-deposit box.

3. Share the location of your list with a trusted person,

such as your spouse or a loyal friend.

4. Meet with an estate planning attorney to create a plan that will

allow for easy transfer of your digital estate to your heirs.

When Your Online Accounts Become Your Heirs’ Problem

Transforming the Lives of Future Generations | Fall 2014

InsIde ThIs Issue:

Giving Gifts That Endure

Use Your Stock to Create Dependable Income

What to Store in a Safe-Deposit Box

CONTACT us at 405.585.5412 or development@okbu.edu to learn more about using this season to make a difference with gifts to Oklahoma Baptist University.

few people want to sift through paperwork when a loved one dies, but now many also have

to plunder through online accounts—stock trades, bank statements, social networks and

emails—to retrieve crucial information and possibly a portion of their inheritance.

REMEMBER THAT “UNIQUE” SWEATER YOUR AUNT GAVE YOU FOR YOUR BIRTHDAY? It’s more likely that you’ve spent years trying to forget about it.

Think of the many times you, too,

have given a gift that wasn’t the right

size, the right color or the latest model.

Were there gifts your family and friends

rushed to return or stashed away in

the far corner of the basement?

Giving great gifts is not an easy task.

Many times it’s because people already

seem to have everything, or a particular

person is hard to buy for. More often,

gift giving is complicated because we

stray from giving gifts that reflect what

is truly dear to us and those we love.

GIvInG GIfTs ThaT endure

How to Give From tHe HeartValues-based giving—a gift-giving

method that allows you to make a gift

to individuals and favorite charities

simultaneously—is a great option

to consider this holiday season.

With values-based giving, you give

a gift that reflects what your friend

or loved one holds precious in life,

such as the mission of a charitable

organization. Your gift becomes a

lasting, tangible expression of the

values in which that person believes.

Following are examples of gifts

you can make to Oklahoma Baptist

University in your loved one’s name:

• Cash—This is the most common and

simplest method of making a gift—but

not always the most cost-effective.

• Securities held long term—When owned longer than one

when you make a gift to

oBu that honors a loved one,

not only will the person you

are honoring be appreciative, but we

will be very thankful as well.

what to do in the first 48 hours when You Lose a Loved one

Don’t Want to Part With Your Assets Today?

consider including a gift to oBu in your will or

revocable living trust of a percentage of your

estate. This flexible donation option allows you

to make an impact without giving up any assets

today. return the enclosed survey to request

sample language you can share with your

attorney to complete your gift.

year, securities are deductible at

their full present fair market value,

with no tax on the appreciation.

• Life insurance—Consider naming

Oklahoma Baptist University

as owner and beneficiary of a

policy you no longer need.

receive SometHinG in returnOftentimes with values-based giving,

you can give and receive. Many types

of gifts made to institutions like

OBU give back to you, the giver.

Depending on which type of gift you

make, you could eliminate capital gains

tax, generate an income tax deduction

and be paid income for your lifetime—all

while helping our important mission.

So, when it comes to buying

another gift, consider skipping the local

department store. Give a gift that benefits

so many more and goes so much further,

a gift that you’ll feel proud to give and

the recipient will be honored to receive.

when you fund a charitable gift annuity with

stocks you’ve owned for more than one year

that are now worth more than you originally

paid for them, you receive several benefits:

• Fixed, steady payments for life for you

and, if desired, someone else you choose

• A partial income tax deduction

• Tax elimination on part of the capital

gains tax on the transfer of appreciated

property

• Satisfaction of supporting OBU

The remaining capital gains that aren’t subject

to tax now are typically spread throughout your

remaining life expectancy. after that, the entire

payment is taxed as ordinary income.

Example: Mary, 70, currently owns $25,000 in stock that is producing low

dividends. She purchased the stock several years ago for $15,000. She is looking

for ways to increase her current income and help Oklahoma Baptist University.

She decides to establish a $25,000 charitable gift annuity by donating her highly

appreciated stock to us.

Amount given to OBU . . . . . . . . . . . . . . . . . . . . . . . . . . . $25,000 in stock

Immediate charitable income tax deduction . . . . . . . . . . $10,380*

Annual payout for life . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,275

Income tax–free portion** . . . . . . . . . . . . . . . . . . . . . . . $566

Capital gain income** . . . . . . . . . . . . . . . . . . . . . . . . . . $377

Ordinary income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $332

* Based on annual payments and a 2.4 percent charitable midterm federal rate. Deductions vary based on income earned.

** Throughout Mary’s estimated life expectancy.

Please call us at 405.585.5412 for more information about

establishing a gift annuity. we will be glad to arrange a

personalized projection of your benefits with no obligation.

Use Your Stock to Create Dependable Income

!

RETURN the enclosed survey

to request the FREE guide

Provide More for Your Heirs and Cut Taxes.

VISIT www.okbu.edu/tamarisk

to learn more about our

values and how you can help.

CONTACT us if you have any

questions about the different

ways to support OBU.

OBU Box 61275 | 500 West UniversityShawnee, OK 74804

Will Smallwood Vice President for University Advancement405.585.5412 | development@okbu.edu

www.okbu.edu

What You Can Do toDaY

1

© Oklahoma Baptist University and The Stelter Company. The information in this publication is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income taxes include federal taxes only. State income/estate taxes or state law may impact your results.

whaT To sTore In a safe-dePosIT Box

OVER THE YEARS YOU’VE AMASSED A GREAT NUMBER OF VALUABLE documents, and those papers do not belong in a box under your mattress. a safe-deposit box is a secure place to store items that would cause panic if lost.

Many banks and credit unions rent safe-deposit boxes. The annual cost can

range from less than $50 to more than $400, depending on where you live

and what size box you need. In addition to the following important documents

listed, consider using a safe-deposit box to store personal items that have

great sentimental value or would be difficult and costly to replace.

What to Keep in a Safe-Deposit Box• Insurance policies

• Birth, marriage and death certificates

• Adoption papers and divorce decrees

• Deeds, titles, mortgage papers and lease contracts

• Military records and citizenship papers

• Stock and bond certificates

• A videotape or DVD inventory of your home and all its contents

What NOT to Keep in a Safe-Deposit Box• Originals of wills, trusts and power of attorney documents

• Medical care directives

• Funeral or burial instructions

You should store these important items that do not belong in your safe-deposit

box in a safe place at home, such as a fireproof/waterproof safe, where they

are more easily accessible in a hurry. You might want to consider giving the

originals of these documents to your estate planning attorney and making

a copy to keep at home or to give to a close relative or friend. Even more

important, make certain the person you’ve appointed in your power of attorney

and medical care directives has original copies of these documents.

Quick Tip: As a precautionary measure, keep a separate list of the items in your safe-deposit box and make a habit of checking the box at least once a

year – if only to keep from forgetting where you hid the key.

!

E printed on recycled paperThe information in this publication is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income taxes include federal taxes only. State income/estate taxes or state law may impact your results.

Provide More for Your Heirs and Cut Taxes

INB18-I

ExampleJerry has $10 million in securities that

create dividends he doesn’t need.

With his other assets, his estate is worth

$20 million. His ultimate goals are to have his

two children inherit his wealth and to make a $6 million

or more pledge over the next 10 years to help support

his favorite charity.

The Solution: Jerry establishes a charitable lead

annuity trust and funds it with $10 million of securities.

Jerry chooses which charity he wants to support and

which loved ones he wants to receive the assets in

10 years. Plus, he can decide how much he wants the

charity to receive each year—the higher the payment

to the charity, the lower the taxable gift. He chooses to

have the trust pay $600,000 (6 percent) annually for the

next 10 years (see chart, right).

Because of the low interest rate, Jerry’s $10 million gift

to the trust generates a taxable gift of only $4.7 million.*

The Benefits: If Jerry had instead left his children

$10 million in securities, all $10 million would have

been subject to estate taxes, leaving his kids a

reduced portion of the securities after taxes. With the

lead trust, the trade-off to the kids is they have to wait

10 years to get the full $10 million or what is left of it.

Therefore, by implementing a charitable lead trust:

■ The children will receive what’s left in the trust.

■ All the growth the securities earn over the next

10 years escapes gift tax. Therefore, regardless of

what the value of the assets grows to in 10 years,

6 7

the children would receive the full amount without

paying a penny in additional taxes.

■ When Jerry dies, the value of the lead trust is not

in his estate and, therefore, is not subject to

estate taxes.

■Jerry is able to control the timing of when his

children receive the assets—in this case, 10 years.

■ His favorite charity will receive $600,000 for

10 years, or $6 million, in support of its mission.

* Based on annual payments and a 2.4 percent charitable midterm federal rate. Deductions vary based on income earned.

Family Charitable Lead Annuity Trust

Transfer $10 million of property

End of 10-Year

TermThis Year

Remainder to children

Jerry $10 million** to two children

Charity receives a total of $6 million over 10 years

Annual payments to charitable organization

of $600,000 for 10 years

6 percent lead trust

* * The ending trust value is unknown because the trust’s assets may increase or decrease over time because of investment gains or losses.

PROVIDE MORE FOR YOUR HEIRS AND CUT TAXES

OBU Box 61275 | 500 West UniversityShawnee, OK 74804

Will Smallwood Vice President for University Advancement405.585.5412 | development@okbu.edu

www.okbu.edu

INB18-I © The Stelter Company

A Winning OptionA technique called a family charitable lead trust helps affluent families remove wealth from their estates and give it to heirs in future years. Although what’s projected to be left in the trust is a taxable gift to the kids now at today’s dollars, this strategy allows you to pass assets to your heirs with low gift taxes— or sometimes none at all.

How It WorksThe lead trust is ideal if you’re charitably inclined and willing to forgo access to part of your wealth now but don’t want to deprive your heirs of that wealth in later years. With this strategy, you give assets to a trust and the trust makes payments to one or more of your favorite charities for a number of years, which you choose. The longer the length of time, the better the gift tax savings for you.

After the period of years, the assets inside the trust generally pass to your kids or other loved ones you select. If you place assets that are depressed in value inside the trust at the beginning, they can grow in value over time and eliminate gift tax on their appreciation. Please contact us to learn more about this option, and, as always, seek the advice of your estate planning attorney and tax advisors before employing a charitable strategy.

A Strategy That Can HelpBenefit the People and Charities Close to Your Heart

Are you interested in a way to combine assets that are currently depressed in value due to market conditions with a charitable gift that: ■Provides money to your favorite charity each year, typically for a certain number of years? ■After a period of years, gives what’s left to your loved ones? ■ Shelters the potential growth in the assets from additional taxes?

2 3

The Time Is NowRecently, the charitable midterm federal rate—the interest rate used in calculating the amount of the gift subject to tax—has been consistently low. These current low rates mean higher tax savings when you fund a charitable lead trust.

Fixed or Variable Charitable Payments?

A charitable lead trust can make payments in one of two ways: ■ A charitable lead annuity trust pays a

fixed amount each year to the charity. ■ A charitable lead unitrust (the less common

variety) pays a variable amount each year based on the annual value of the assets in the trust. With the unitrust, if the trust’s assets go up in value, the payments to the charity go up as well. On the other hand, if the assets decrease in value, so do the charity’s payments.2 3

Give cash or property and receive a partial gift tax deduction

You

Charitable Lead Trust

1

Our charitable organization receives yearly payments

Remainder to loved ones at end of trust’s term, without further taxes

Charitable Organization

Your Loved Ones