Goals for Giving
"Penn State has always been dear to our hearts," says Joyce '50 SCI and Charlie '51 LIB Mathues. "We met at Penn State, spent many happy years there, and have enjoyed our return visits to the campus. We both felt we had received a great education from our respective colleges. We decided early on to make Penn State a part of our will and to give back for all that we have received."
Over the years, the Mathueses accumulated real estate that had grown substantially in value. However, real estate, other than a primary residence, is subjected to capital gains tax. And then, of course, there is the cost of marketing and selling the real estate, which takes time and effort. But making a gift of real estate-either outright or as a remainder interest-can result in valuable income and estate tax deductions and capital gains tax is avoided. So, after retirement, they thought about using one of their properties to make a gift to Penn State. After talking with their lawyer and with staff from Penn State's Office of Planned Giving and Endowments, they decided to make a gift of real estate to the University to establish a charitable remainder unitrust.
It worked like this: They set up a trust and funded it with the piece of property. The trust then sold the property for cash, which was then invested to generate an interest income for life for the couple. At the death of the second spouse, the balance of the trust will go to the Eberly College of Science and the College of the Liberal Arts to fund scholarships in their names. They also decided to create a scholarship in memory of a special professor.
Additionally, they have the option of giving back some of the income interest derived from the charitable remainder unitrust, which can be used to start the scholarships during their lifetimes.
Real estate is just one of the many assets that can be used to fund charitable remainder unitrusts, but for Joyce and Charlie Mathues, it was the best asset to achieve their goals and help Penn State students achieve theirs.
The information on this website 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. Annuities are subject to regulation by the State of California. Payments under such agreements, however, are not protected or otherwise guaranteed by any government agency or the California Life and Health Insurance Guarantee Association. A charitable gift annuity is not regulated by the Oklahoma Insurance Department and is not protected by a guaranty association affiliated with the Oklahoma Insurance Department. Charitable gift annuities are not regulated by and are not under the jurisdiction of the South Dakota Division of Insurance.