LIFE INCOME
 

Life Income Gift
The spirit of Bohemia and the ancient art of Patronage have long been intertwined. Kings and emperors, lords and ladies, and citizens of wealth and power generously supported the creative process of poets and writers, painters and sculpturers, actors and musicians. The 'grand tradition' continues today...

What is a Life Income Agreement?

With a Life Income Agreement, you make an irrevocable gift in exchange for an income stream for the remainder of your life or the life of yourself and your spouse. Sometimes a life income agreement can provide income not only during your life, but also during the lives of your children. Upon the passing of the last beneficiary, the residual goes to PacRep.

When should a Life Income Agreement be considered?

There are several situations where a life income agreement can be an attractive giving option. One common situation is if you own a valuable asset that has grown substantially in value. The asset may be one that, despite its value, does not generate much in the way of income that you could use to support yourself. Because the asset has grown in value so much, you are reluctant to sell the asset and pay a large capital gains tax.

Another situation is when you want to provide for children who are not capable of managing an inheritance. A life income agreement would provide monthly, quarterly, or annual income for your children for the remainder of their lives. Your heirs are not saddled with the responsibility of managing a large portfolio, nor would they be able to squander anything more than their latest distribution check.


What are the advantages of a Life Income Agreement?

The major advantages are:
  • Income for life (or the life of your designated beneficiary).
  • If you make your gift with low-yielding or unproductive assets, you may actually increase your current income.
  • If you make your gift with appreciated assets, you may avoid capital gains taxes.
  • Immediate income tax deduction when the gift is made.
  • May reduce estate taxes (depending upon the size of your estate).
  • Enables you to provide a substantial future support to a cause that is important to you.
  • Membership in the Encore Circle, the community of PacRep supporters who have made similar provisions in their estates.
How do I make a Life Income Agreement?

Making a life income agreement will require the professional services of an attorney who is knowledgeable in estate planning. We can help you identify qualified attorneys to help you if you are not already working with one.
 


To discuss a contribution or show sponsorship, or to find out more about PacRep Theatre's planned-giving program, please call Executive Director Stephen Moorer at 831.622.0700 ext. 104.



How do I establish a life income gift?

Family obligations and the need to provide for retirement, coupled with the high cost of living, make it difficult for many people to consider substantial charitable gift now. But there is a way to have the satisfaction of making a meaningful lifetime gift without sacrifice. In fact, you can get current income tax and financial benefits. It is called a life income gift. You irrevocably transfer some assets to Pacific Repertory Theatre now, and in return, you (and a survivor, if you wish) receive income life. As a result, the assets are used to carry out our mission.

By making a life income gift to Pacific Repertory Theatre, you will receive the following benefits, in addition to the pleasure of knowing the good work your gift will do.
  • A charitable deduction in the year you make the gift for the present value of our right to eventually receive the assets.
  • Your effective yield is increased by substantial income tax savings.
  • Income can be taxed more favorably in some plans.
  • You unburden yourself of investment concerns.
  • Your probate and estate administration costs may be reduced.
What are examples of life income plans?
  • Charitable Gift Annuity
  • Joint and Survivor Annuities
  • Charitable Remainder Trust
  • Unitrust
  • Annuity
  • Pooled Income Fund

We make no claims regarding the accuracy of the above information or the tax consequences stemming from your use of it. Please consult with your own tax, legal, or financial planning advisor.


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