Alumni & Friends

Planned Giving

Walter Lain speaking to students near HillmanEach year, Simpson College receives amazing financial support from alumni and friends who realize that through an estate gift they can have a tremendously positive impact on the school they care so much about. These generous people realize they can make their college financially stronger and, in many situations, help their tax situation as well as their loved ones.

The Office of College Advancement has established this page to help you better investigate the advantages of establishing a planned gift, both to you and to Simpson.  We know that this information is just a start, and we encourage all of those who are considering providing a planned gift to Simpson to seek advice from a professional financial planner. If you, or your financial planner, have questions about this information or would like additional information about planned giving, please contact Bob Lane or Chris Goodale at 800-610-6369.

Here are some brief descriptions of the most traditional planned giving options:

Will
A will is a legal record to tell your loved ones how you would like your property divided after you pass away.  Leaving a valid will is the best way to be clear about your desires and wishes. Without a will, the state in which you live will distribute your assets for you according to state law.  If you are interested in including Simpson in your will, it is very simple, all that needs to be outlined in your personal document is to state:

“I give to Simpson College, Indianola, Iowa (TIN 42-0680389).
(Choose one of the following:)
…the sum of $_______________.
…all of my interest in the following described property:____________________.
…_______ percent of all of the residue of my estate.

Then decide how you would like your estate gift directed by including: “This gift is intended…
(Choose one of the following:)
…to be used as the Board of Trustees of the College shall determine.
…to be used for the purpose of _______________.
(For example: supporting the Blank Performing Arts Campaign or Campus Center Campaign, the general endowment fund, building and maintenance, or creating a scholarship.)

If in future years, the stated purpose is no longer necessary, practical, or possible, the Board of Trustees of Simpson College shall use its discretion to designate this gift for a related purpose that best promotes and supports the mission and programs of Simpson College.

Gift Annuity
This secure financial tool will pay you (and a survivor, if desired) a fixed dollar amount for the remainder of your life.  By creating an irrevocable charitable gift annuity with the college or a financial institution, you no longer have to worry about variable returns on your investments. The amount of the payout is determined by your age at the time the annuity is created.  The tax advantages come with a charitable deduction for part of the overall value of your annuity on the year it is established.  A portion of each annuity payment is also tax-free.  Each of these amounts is determined through actuarial tables.  A charitable gift annuity is a gift that gives you guaranteed and attractive income with no investment worries or responsibilities while you make a special and enduring gift to leave your legacy at Simpson.

The Charitable Remainder Trust
This is an investment fund you create to pay yourself a known annual income that is determined at the outset, based on your personal needs and circumstances. After your lifetime (or that of a survivor, if desired), the corpus of your trust goes to Simpson as your enduring legacy.  The tax advantages of a Charitable Remainder Trust come at the onset with a charitable deduction for part of the overall value of your trust on the year it is established.  A portion of each payment is also tax-free based on mortality tables.

Charitable Lead Trust
If you should have a sum of money that you will not need for a set period of time, say ten years, you may give it to Simpson for that time and make arrangements to have that sum returned to you when you need it.  With this planned gift Simpson College earns an income from your assets during the years they hold the sum. After that set amount of time, the principal is given back to you or your family.  The benefits are that you will enjoy valuable tax benefits without forfeiting the trust principal while you gain the personal satisfaction of making an amazing gift to the college.

Retirement Plan Assets
Giving gifts to the college from either employer provided funds or personal Individual Retirement Accounts can be a great source for a planned gift to Simpson or annual support through The Simpson Fund.  The principal advantage of donating retirement plan assets is the avoidance of income taxes, as well as estate taxes. Since the funds in a qualified plan usually represent deferred compensation, giving these assets to individual heirs may trigger a total effective marginal tax rate that is incredibly steep -- even exceeding 55% in some cases.

After your lifetime, the undistributed balance in a retirement plan account will have to be distributed to someone else, who will be taxed, or to a designated charitable entity. Because Simpson College is tax-exempt, the deferred income in your qualified retirement plan account may never be taxed when you name the college as the ultimate beneficiary.

To leave the balance of a retirement account to Simpson after your lifetime, simply advise the plan administrator of your wish and complete any forms required.  Perhaps you want your heirs to benefit from your retirement account, as well as Simpson (or other charities), then you may designate a specific amount to be given to Simpson, before the division of the balance among your heirs.

Individual Retirement Account (IRA) Roll Over
If you are 70.5 years of age or older and have an Individual Retirement Account (IRA), it is likely that you are already aware that you are required to take a minimum annual distribution or face a penalty. Another option available is to "rollover" your required minimum distribution to a qualified charity instead of taking the required distribution and potentially changing your tax status. This is especially helpful to those who would rather see their distribution used to further the Simpson Experience for our students in lieu of increasing their taxable income.

To take advantage of this rollover, please consult with your tax advisor and then we can work together to make sure all of the details get handled correctly.


Some qualifications of the provision include the following:

  • You must have reached the age of 70 ½ by the time the charitable gift is made.
  • The rollover may be used to satisfy your required minimum distribution.
  • The act allows up to $100,000 to be given via this method.
  • Because the rollover does not affect your adjusted gross income, the rollover gift can be made in addition to any other charitable gifts you have planned.

Life Insurance
Often we find that the purpose for our life insurance no longer seems to be a high priority as we can actually “out live” our originally purpose for this prudent investment.  This then might be the most sensible way to make a gift of great impact to Simpson. By naming the college as beneficiary of a life insurance policy and assigning ownership of that policy to Simpson, you may be entitled to a valuable income tax charitable deduction.  If you find that you are no longer in need of the protection of a life insurance policy that is “paid-up” you may easily transfer ownership of your insurance policy to Simpson simply by contacting your insurance administrator and filling out the necessary paperwork.

Real Estate
A gift of real property may be an excellent way to provide an amazing gift to the college. Your personal residence, farm, vacation home, commercial property or parcel of undeveloped land may all be a possibility for a gift to Simpson.  You may be in a position to give the property to Simpson immediately, or you may want to use the property a while longer or even retain lifetime use. In any case, you may still make the necessary arrangements now and benefit from a substantial current income tax deduction.

Giving Property Today
When you make an outright gift of real property today, you obtain an income tax charitable deduction equal to the property's full fair market value (if held long-term) not just what you paid for the property or your “cost basis”.  This action makes a huge difference at Simpson, as well as allowing you to avoid tax on the property's appreciation or capital gain, the transfer isn't subject to the gift tax, and the gift reduces your taxable estate.

Giving Property When No Longer Needed
You may give Simpson your home and receive a charitable deduction for it, even though you continue living there. This arrangement is called a “retained life estate”.  By deeding your home to the college now, subject to these rights, you can obtain a sizable income tax deduction this year and you can live in the home for as long as you like.

Last Updated: 11/18/11