President Elect Elect, Jared Campbell, called the meeting to order and led us in the Pledge of Allegiance. Fabian Shepard then led us in a thoughtful Invocation.
Club Anniversaries: Patrick O’Malley - 31 yrs July 3rd Dennis McKeehan 16 yrs July 3rd Jim Winn -15 yrs July 2nd Fabian Shepard - 1 yr June 28th Ken Smith – 37 yrs June 25th
ANNOUNCEMENTS:
This week’s Greeters were the 23/24 Board of Directors.
Reminder for the upcoming REGATTA KICKOFF PARTY at the SHIP in the West Bottoms (1221 Union Avenue, KCMO 64101) on Wednesday July 17th – 5 pm to 7 pm. FREE ENTRY (i.e.- NO cover charge) with Cash Bar, Live Music & Appetizers.
UPCOMING EVENTS & MEETINGS:
July 4: NO Meeting
July 11: Changing of the Guard (Tim Tholen – incoming President)
July 18: Carolyn Glenn Brewer, “The Importance of Instrumental Education”
July 25: 4th Thursday – Social at Minsky’s Pizza 5 pm (5105 Main St, KCMO)
August 1: Allan Katz, American Public Square
August 29: 5th Thursday event at the Rock Island Bridge
PRESENTATION: Jerry Cooke introduced our speaker, Bill Eckert of Renaissance Financial, a local personal financial planning firm. Jerry Cooke, from time to time, has recommended Bill to several of his life insurance clients. Bill’s Topic was Philanthropy that Benefits You, Your Family and the Community. Bill, an alumni of Rockhurst High School and the University of Kansas, is a financial educator, speaker, and senior financial advisor with Renaissance Financial Corporation, who specializes in working with high-net worth families with their estate planning, wealth and tax management, intergenerational wealth transfer and charitable giving. Bill is an expert on showing families how they can truly make a philanthropic impact in their communities through their charitable giving and estate planning.
Bill shared with us several real-life family financial fact patterns in which using a combination of charitable gifts through trust and life insurance provided more actual dollars to the family members as well as creating a charitable legacy. The following is an incomplete review, as Bill shared various scenarios with graphs in greater detail than I can relate here. One significant mantra of the fact patterns and solutions is to reduct Uncle Sam’s tax payments, while increasing everybody else’s share, including charities. One slide was a reminder of “Basic Estate Planning” documents before or separate from of the “solutions” provided. Those basic documents, using his labels, are a “Living Trust”, “Pour Over Will”, “Power of Attorney”, and “Health Care Power”. These four are the Estate Planning bedrock.
A couple of Bill’s discussed tools were Irrevocable Life Insurance Trust (ILIT’s) and Charitable Remainder Unitrust. With the ILIT, financial gifts are made to a trust with written notification to the beneficiaries (kids or grandkids) that the gifted funds are available to them for their withdrawal for a set period of time (usually 30 days upon receipt). When the beneficiaries do not withdraw their gifted funds, the Trustee pays the life insurance premiums out of those gifted funds. When the Settlor dies, the life insurance proceeds received by the beneficiaries are nontaxable. With the Charitable Remainder Trust, the Settlor is giving away the principal after his death or the joint deaths of husband & wife, or add in another generation. The Settlor gets an immediate income tax deduction AND a stream of payments. This could work well with highly appreciated stock with low dividend yield or long held & appreciated rental property. When the Settlor sells the rental property on his own, he will recognize income tax from the capital gain income on the increase in value and ordinary income to recapture the depreciation taken over the years against his/her cost basis. By contrast, the Charitable Trustee, as a tax exempt entity, can sell that same rental property without incurring any taxable income and pay out an annuity.
There was also discussion of tax benefits (& efficiency) of charitable giving through a Traditional IRA. After ages 72 or 73 depending on the year of birth, individuals are required to receive at least a minimum distribution (RMD) annually from their Traditional IRA’s as income taxable withdrawals. The “trick” here, for the charitably inclined, is to instead direct their RMD amount or portion thereof to their favorite charity (church, college/university, Rotary Foundation, Salvation Army, the Red Cross etc). The income tax efficiency here is that neither the RMD income nor the charitable contribution appear on the 1040. Alternatively, if the taxpayer receives the RMD $ himself and over time makes contributions to charity, the RMD is income taxable and the taxpayer may not be able to deduct the charitable contribution because of (1) elimination of several formerly deductible expense types and (2) the dramatic increase in the Standard Deduction.
Again, I could not here relate all of the valuable information and insights that Bill shared with us. For that I apologize. All this reminds us that estate & tax & charitable planning are important personally as well as financially worthwhile.
Today’s Quote:We make a living by what we get. We make a live by what we give. Winston Churchill
Jared Campbell wrapped up the meeting with the Four Way Test.
[as an ongoing scrivener’s note: our local Club 13 Rotary organization is comprised of at least three interrelated groups (like a three-legged stool), each with its own separate board, officers & primary focus. KCRClub 13 comprised of various committees and weekly luncheon meetings with speakers; KCRC Foundation primarily focused on financially supporting the Club 13’s Rotary Youth Camp; and the Rotary Youth Camp*, near Lake Jacomo, at 22310 NE Colbern Road, in Lee’s Summit, MO 64086] (* Rotary’s oldest continuous ongoing project in the world!)
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