Planned Gifts

Bequests
Bequests are gifts made by will. They are the most popular type of planned gift and have been crucial to the extraordinary growth and success of The Museum of Modern Art. Whether you wish to provide general operating income or to support a specific department or program at the Museum, your bequest expresses your lasting commitment to MoMA. A bequest to the Museum may also help you meet your financial and estate-planning goals, since an estate and gift tax charitable deduction for the entire amount of the gift is allowed. While your estate plan will be prepared by your attorney in consultation with your tax and financial advisors, the Museum's Office of Planned Giving would be pleased to discuss any of the various giving opportunities with you.

Types of bequests include:

• A cash bequest of a specified dollar amount.
• A specific bequest or devise of property, by which MoMA receives specified assets, such as marketable securities, an interest in real estate, or tangible personal property (e.g., artwork, antiques, or rare books). Note: if you are considering bequeathing a work of art to MoMA, we advise you to contact the appropriate curatorial department at the Museum. Gifts of real estate also require special advance consideration by MoMA, and we encourage you to contact the Office of Planned Giving if you are contemplating leaving real estate to the Museum.
• A residuary bequest or devise, by which the Museum receives all or a percentage of the remainder of your estate after specific legacies, debts, taxes, and estate expenses have been deducted.
• A contingent bequest or devise, by which property is distributed to MoMA only if you outlive your named beneficiaries.
• A testamentary provision establishing a charitable remainder trust, in which one or more named beneficiaries receive income for life or for a term of years, after which time the assets pass to the Museum.
• A testamentary provision establishing a charitable lead trust, which pays income from the trust to MoMA for a period of years or for the life of one or more individuals, after which time the assets pass to your heirs.
• Qualified retirement plan assets, by which you name the Museum as a beneficiary or contingent beneficiary of all or a specified percentage of your plan assets. With this type of bequest, you can support the Museum while also removing from your estate assets which may otherwise be subject to heavy taxation. Generally, if you intend to make both noncharitable and charitable gifts at death, it makes sense to use your tax-deferred retirement plan assets for charity and other assets for heirs. Retirement plan assets can also be placed in a testamentary charitable remainder trust to provide income to your heirs for life or a term of years, with the remainder interest passing to MoMA.

Contact the Office of Planned Giving at plannedgiving@moma.org or (212) 333-6527 for further information or to receive and to receive our brochure, Your Bequest to MoMA.

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Life Income Plans
Life income plans allow you to make a substantial gift to the Museum and at the same time retain a benefit from the assets you give. When you establish a life income plan, you irrevocably donate assets to the Museum and in return receive income for life or for a term of years. When the life income plan terminates, the assets remaining pass to MoMA. Life income plans offer a number of important potential benefits such as an income tax charitable deduction; increased spendable income in many cases; elimination of, or reduction in, capital gains tax liability if appreciated property is donated; and a diminution in the size of your taxable estate. You should consult with your financial advisor for more information on these plans as they pertain to your particular situation and needs. Most importantly, the financial benefits derived from these arrangements allow you to make a contribution to the Museum larger than might otherwise be possible.

MoMA can assist with two types of life income plans:

Charitable Gift Annuities, which are partly gifts and partly annuities, are the oldest and most popular vehicles for making a gift and receiving income. They provide a fixed annual sum for life for you and/or another in return for a gift of at least $10,000 in cash or marketable securities. The payout rate depends on the number of annuitants and their ages. (MoMA follows the rates recommended by the American Council on Gift Annuities.) Creating a charitable gift annuity generally allows you to claim an immediate income tax charitable deduction. A portion of each annuity payment is treated as a tax-free return of principal.

Sample rates for a charitable gift annuity are as follows:

It is possible to defer annuity payments until a future date of your choosing, an attractive feature for younger donors. By postponing income payments—until retirement, for example—the annuity payout increases as does the income tax charitable deduction. This deduction may be claimed in the year the gift is made.

Sample rates for a deferred payment charitable gift annuity are as follows:

Charitable Remainder Trusts are separately managed trusts that can be tailored to meet your financial goals with respect to the payout rate (a minimum of 5% of the trust principal's fair market value is required), type of income (variable or fixed), and payment schedule. To establish a remainder trust, you make an irrevocable contribution of cash, securities, or other property, which is placed in trust. You receive the right to a stream of income, and the Museum receives the right to principal as a remainder interest. There are three types of trusts: (1) the annuity trust, which pays a fixed dollar amount each year based on a percentage of the initial value of the trust assets; (2) the unitrust, which pays a variable income based on a percentage of the fair market value of trust assets as revalued each year (or based on the trust income in the case of a net income unitrust); and (3) a "flip" trust, which pays net income only until a specified date and then becomes a standard unitrust. These trusts may be established to pay income to one or more named beneficiaries for life and/or for a set term of years (not to exceed twenty). The minimum contribution to establish a charitable remainder trust is $100,000. Establishing such a trust generally entitles you to claim an immediate income tax charitable deduction.

Contact the Office of Planned Giving at plannedgiving@moma.org or (212) 333-6527 for further information and to receive our brochures, Creating a Charitable Gift Annuity for MoMA and Creating a Charitable Remainder Trust for MoMA.

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Charitable Lead Trusts
If you want to preserve assets for yourself or your heirs and still make an annual gift to The Museum of Modern Art, you can establish a charitable lead trust. These trusts allow you to provide income for MoMA for a set term of years or for a term measured by one or more lives. The payments to MoMA can be either a unitrust amount (i.e., a fixed percentage of the trust asset's net fair market value each year) or an annual guaranteed annuity. There are two types of lead trust: the grantor lead trust, in which the asset placed in the trust is returned to you (and/or your spouse), and the nongrantor lead trust, in which the asset passes to a named beneficiary, generally children or grandchildren, at the end of the trust term.

Grantor Lead Trust
To establish a grantor lead trust, you (the grantor) donate assets to a trust, which pays an income to MoMA (typically for a set term of ten years or less). If the trust is qualified (i.e., if it pays the charity either a unitrust amount or a guaranteed annuity), the creation of a grantor lead trust entitles you to claim an immediate income tax charitable deduction equal to the present value of the income stream that the Museum will receive during the trust term. At the end of the trust term, the assets revert to you. You are responsible for any tax due on the income earned by the trust. For this reason, this type of trust is often funded with tax-exempt securities. A grantor lead trust generally works well for a high-income professional who receives significant additional taxable income in a particular tax year.

NonGrantor Lead Trust
To create a nongrantor lead trust, you place assets in trust either during your lifetime or through a testamentary provision. MoMA receives the income produced by the trust (typically for a set term of fifteen years or more). At the trust's termination, the assets pass to one or more of your heirs. Transfer tax is greatly reduced because you are generally allowed a reduction in gift or estate tax for the value of the lead interest that will be paid to MoMA, and also because there generally is no tax on the appreciation of the value of the trust during the trust term. For this reason, these trusts are effective estate planning vehicles, particularly if the assets placed in trust have a high potential for appreciation. When assets are being transferred to grandchildren, these trusts can be used to maximize the lifetime exemption from generation skipping transfer tax.

Contact the Office of Planned Giving at plannedgiving@moma.org or (212) 333-6527 for further information.

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Life Insurance Policies
A gift of a life insurance policy offers a simple way to support MoMA if you own a policy that is no longer needed to provide for dependents. If you are considering donating your life insurance to MoMA, you should consult your lawyer for any state law restrictions on such a gift.

If you donate a policy to MoMA and retain incidents of ownership of that policy, you will not be able to obtain an income tax deduction. You are deemed to have incidents of ownership if you retain control over that policy, such as by retaining the power to change the beneficiary, borrow against, assign, surrender, or cancel the policy. If you choose to donate a policy to MoMA while retaining incidents of ownership, the proceeds of your policy are includable in your gross estate, however an offsetting estate tax charitable deduction generally would be allowed.

Alternatively, you generally would be entitled to an income tax deduction if, state law permitting, you assign irrevocably an insurance policy to MoMA as owner and beneficiary of the policy, divesting yourself of all incidents of ownership of the policy. With this type of gift, the size of the income tax deduction depends on the type of policy contributed. If the policy is fully paid up, generally you will be able to claim a deduction equal to the policy's replacement cost, which is approximately the face value. If that amount exceeds the policy's cost basis, your deduction would probably be limited to the cost basis.

If you donate a policy that has an obligation for future premium payments, the size of your income tax deduction would generally equal the approximate cash surrender value or the cost basis, whichever is less. If you choose to continue to pay premiums after the date of your donation, you will be entitled to claim an income tax charitable deduction for each year that the premiums are paid, provided that you contribute the premiums to MoMA for payment rather than pay the insurance company yourself.

Contact the Office of Planned Giving at plannedgiving@MoMA.org or (212) 333-6527 for further information.

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Pictured above:
Vincent van Gogh. The Olive Trees. 1889. Oil on canvas, 28 5/8 x 36" (72.6 x 91.4 cm). Mrs. John Hay Whitney Bequest. The Museum of Modern Art, New York