Experts Say Endowments Not Just for Your Rich Aunt

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Investing in a strong Jewish future by making a legacy gift through the Jewish Federation’s Life & Legacy program is simple and you don't have to be "wealthy" to do it. Most legacy gifts are made by naming Jewish communal organizations as beneficiaries in wills, retirement accounts, and/or life insurance. However, recent changes in federal and state laws impacting taxes and charitable giving have prompted many questions. Several financial professionals from our community, who also volunteer to help local Jewish organizations cultivate legacy giving, were asked to share tips for donors of all ages to invest in a strong future for the Jewish institutions they care most about. Here’s what they had to say:
 
Zoltan Kemeny is a CPA and president of Highland Park Temple-Congregation Anshe Emeth. 
 
Q. What’s so special about your synagogue that inspired you to devote so much of your time to ensuring the success of its legacy program?
 
A. The Highland Park Conservative Temple-Congregation Anshe Emeth has been the place where I made my friends and raised my children. It has been a place of my spiritual growth and my place of comfort. Listening to the sermons and classes given by Rabbi Eliot Malomet and the other dedicated rabbis who are members of our temple have enriched the Jewish education I obtained throughout my life and has enabled me to reach a far more nuanced and complex understanding of Jewish texts and culture. Knowing that our children and their children have been the beneficiaries of attending Marlene Herman’s Shabbat classes, and have transmitted her vibrant love of Judaism within our family and to their friends, gives my wife and me deep satisfaction.
 
While it is demanding to be in a position of leadership, getting involved in all facets of synagogue life felt natural and added a special value to my life. The sense of community and the comfort, both spiritual and practical, that the temple has provided us need to be maintained and transmitted for us and for future generations.
 
 
Q. Can you suggest some easy tax-saving opportunities under the new income tax laws for donors to lower taxes in 2018 and beyond?
 
A. Since the standard deduction was almost doubled beginning in 2018, the strategies that many of my clients are using to maintain the deductibility of their donations is to set up donor-advised funds or to bundle up their contributions in one year. These giving options allow them to benefit from itemization and to take the standard deduction in another year.
One part of the new law that often is overlooked is that the charitable deductions have increased to 60 percent of current year adjusted gross income (AGI), with excess donations carried forward. Previously taxpayers were limited to 50 percent of their AGI.
 
As a tax adviser, I educate my clients to the most beneficial tax-saving strategies that the law permits. However, I find that people do not donate simply for saving money. People choose their charities carefully, and they donate to help others and improve the world.
 
 
Mike Wasserman has led the federation’s Life & Legacy efforts for many years and recently became president of the Jewish Cemetery Management Corporation. 
 
Q. What inspired your interest in promoting legacy giving?
 
A. After spending a year on a federation task force examining a wide array of fund-raising options, the one that jumped off the page as having the biggest potential impact was legacy giving. 
 
                                         
Q. What is involved in your new role as president of the Jewish Cemetery Management Corporation and the potential connection to the federation’s legacy activities?             
 
A. Having handled cemetery operations at my synagogue for many years, I wanted to share the expertise I acquired with the broader community. In my role as president of the Jewish Cemetery Management Corporation, I recently completed a survey identifying all the Jewish cemeteries in our community. I have been meeting with trustees of several of these organizations to offer information on best practices in funding and operating these properties in perpetuity. The Jewish Federation’s Life & Legacy program and the Jewish Federation Community Endowment Fund can help cemeteries manage their financial resources.
 
 
Q. When you meet with financial professionals in our community, what’s the single best piece of advice you give them to explain legacy giving to their clients?
 
A. I provide financial advisers with specific language they can use when speaking to clients about philanthropy, such as, “Many clients leave money to charity in their will because they care about causes that are important in their lives. Are there any causes that have been important in your life that you would support in this way?” Helping prospective legacy donors connect with what matters to them does a service to the donor and the 
community. 
 
 
Ed Smeltzer is an estate attorney and a Life & Legacy team member of Temple B’nai Shalom in East Brunswick.
 
Q. As a supporter of your temple’s legacy program and someone who has assisted federation with legal advice on legacy issues, what drives your passion for these activities?
 
 A. I’m the non-Jewish partner of an interfaith couple committed to raising our children with Jewish traditions. Temple B’nai Shalom satisfied my wife’s idea of what a synagogue should be and made me feel a welcome part of my children’s religious education. I believe it is important to ensure my temple’s continuing viability. When I was invited to join several other financial professionals to round out the temple’s very active legacy team, I found the perfect way to contribute my experience in estate planning and administration.
 
 
Q. What are the key issues now for donors who are planning a legacy gift?
 
A. The large increase in the federal estate tax exemption and elimination of the N.J. estate tax has caused a fundamental shift in the approach taken to most donors’ estate planning. The focus has shifted from estate tax reduction to personal objectives and income tax planning.
 
A gift to a charity by will or codicil, while valuable to the charity, is often not optimal from an income tax point of view because the estate will not benefit from an income tax deduction for such a gift. A better approach, when possible, is to name the charity as a beneficiary of an IRA, 401(k), or tax-deferred annuity. By doing so, the charity can claim such assets income tax-free and additional estate assets, not subject to income tax, can pass by the will to the family. Because tax-deferred retirement accounts can decline as donors take their required distributions, they should plan accordingly to ensure that the charity gets the desired gift.
 
Charitable gifts by beneficiary designation also are not subject to certain reporting requirements that apply to charitable gifts by will and can simplify the estate administration process for a donor’s family.  
 
 
Keith Zimmerman is a chartered life underwriter and member of the B’nai Tikvah legacy team.
 
Q. Keith, based on your long tenure as federation campaign chair, what is your favorite way to begin a conversation about legacy giving at your synagogue?
 
A. I find that prospective donors appreciate the opportunity to talk about how they want to be remembered. It encourages them to talk about what is important in their lives now and how a legacy gift will impact the future for both their family and cherished Jewish institutions.
 
 
Q. What was the impetus for your support of the legacy program at the federation and your synagogue?
 
A. Through our long involvement with the generous and caring members of Congregation B’nai Tikvah and the federation, my entire family has made wonderful friendships which have enriched our lives in so many ways. Using my expertise to help promote legacy giving throughout our community is my way of giving back for these precious gifts.
 
   
Q. Can you suggest a few easy ways life insurance can be used to make a legacy gift?
 
A. Using life insurance is a great way to make a substantial legacy gift for a relatively modest outlay with a new policy or policies no longer needed for their original purpose. You can easily add your favorite charity as a named beneficiary by contacting your agent. If you make the charity the owner and beneficiary of the policy, you are entitled to a tax deduction and the policy proceeds benefit the charity. You can make deductible contributions to the charity that can be used to pay the premiums. 
 
 
Susan Antman is the executive vice president of the Jewish Federation in the Heart of NJ
 
Q. How can someone create their own legacy commitment? 
 
A. It’s easy to create your own personal legacy by signing a simple letter of intent, which is a non-binding promise to leave a gift in the future to the organization(s) of your choice. Let organizations know if you already worked with a financial adviser to include them in your future plans or go to www.jewishheartnj.org/legacy to easily access contact information for participating organizations and our simple letter of intent. 
 
There is no better time than now or a better place than the heart of New Jersey to join with the hundreds of legacy donors who already committed to the future of a vibrant Jewish Community. Combined with others, your gift will make an enormous impact on generations to come.
 
 
Since the inception of the Life & Legacy program in the heart of NJ, sponsored by the Jewish Federation and Harold Grinspoon Foundation two years ago, the program has secured $11 million in estimated future value from over 400 gifts to 16 local Jewish organizations. In addition, participating organizations have earned a total of $200,000 in cash incentives that can be used today to further their missions.
 
Please note: The advice provided in this article is for informational purposes only and should not be construed as legal, tax, or financial advice. When considering gift planning strategies, you should always consult with your own legal and tax advisors.
 
PHOTO CAPTION: HONOREES, BONNIE AND SHELDON FREIDENREICH, WITH FELLOW LEGACY DONORS AT COMMUNITY LEGACY CELEBRATION, DEC., 2018

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