Thousands of Oakland City University alumni and friends, as well as supporters from the corporate world and charitable foundations, provide the support our University’s people and programs need to maintain a heritage of academic excellence.

Outright gifts provide valuable support for current programs while planned or deferred gifts are for future use. The extent of benefits to the donor depends upon how the gift is made. This web page is intended to introduce donors to the various methods by which they may support OCU and simultaneously retain tax benefits.

The staff of the Oakland City University Development Office assists donors in finding giving strategies that will answer their long-term charitable goals. The Development staff is dedicated to finding the most efficient, personally satisfying and financially advantageous method for each donor to make his or her contribution. We are happy to work with you and your financial and legal advisors without cost or obligation.

The University is a “qualified charitable organization” and meets the standards and requirements of the Internal Revenue Service within the meaning of IRS code Section 501(c) (3). Under this code, all contributions are deductible for federal income tax purposes (subject to statutory limitations) and for federal estate and gift tax purposes. The University’s federal identification number for tax purposes is 35-0869063.

A further benefit is available to Oakland City University donors who reside in Indiana. A tax credit is available for up to 50 percent of a $200 gift from a single taxpayer or $400 from a married taxpayer. A tax credit is also available to corporate donors. Contact the Development Office for details.

Cash Gifts
A gift of cash is the easiest way of giving to Oakland City University. Simply make your check payable to Oakland City University, 138 N. Lucretia St., Oakland City, IN 47660. Please include a short note with your check stating the purpose or designation of your gift or you may note this on the memo line of your check. Without designation your gift will be recorded as unrestricted for use as determined by the University President and the Board of Trustees. We also accept MasterCard, Visa, Discover, and American Express. Please call us at 812.749.1212 to arrange a credit card payment.

Gifts of Securities
Common Stocks, bonds, mutual funds and other appreciated securities may be donated to the University. Depending upon the circumstances, Oakland City University will either manage or liquidate the securities to achieve the donor’s goals. A popular benefit of such a gift beyond the charitable income tax deduction is the avoidance, in most cases, of capital gains tax on the appreciation. It is almost always to your advantage to transfer appreciated securities to the University directly, rather than selling them and giving cash.

You, your broker or bank trust officer should contact the Oakland City University Development Office to determine the best method for the transfer of your securities to the University. Instructing the transfer agent to reissue the stock in the University’s name often causes delay. This can especially be a problem for year-end gifts, since the delay could result in a different valuation or gift date than intended. For information about gifts of stock in closely held corporations, also contact the Development office.

Gifts of Property
Donors may contribute real estate such as a residence, vacation home, farm, ranch, commercial property or land to Oakland City University. In addition, certain tangible personal property including artworks, books, equipment, furnishings, automobiles, inventories and other valuables may be appropriate gifts for a particular discipline or a library collection. These gifts can receive the same tax treatment as gifts of securities: no capital gains tax plus deductibility at fair market value. Property gifts valued at $5,000 or more require the donor to obtain a qualified written appraisal.

Usually, Oakland City University will accept gifts of real estate if no restrictions are placed on selling the property or if the property can be of direct or indirect use by the University. Donors can also transfer title of a personal residence or farm and retain the right to live in or use the property for life. After the death of a surviving spouse, the property comes to Oakland City University. A current gift of a home or farm with retained life possession gives the same tax benefits as a gift by bequest – plus immediate income tax savings. Probate costs may be saved as well.

Gifts of property whose value has declined since acquisition should never be transferred directly to the University it would be more beneficial to sell the property, take the deductible loss, donate the money, and receive the charitable tax deduction for the amount of the cash gift.

Corporate Matching Gifts
Many corporations encourage employees to participate in philanthropic opportunities by matching, doubling, or even tripling each dollar they contribute to the University. Your company’s personnel department can provide details and the matching gift form to include with your gift check.

Deferred Gifts
Deferred gifts are the result of careful planning that integrates a donor’s charitable gift into his or her overall financial, tax and estate planning objectives so as to maximize benefits for both the donor and the University. Planned gifts typically come from a donor’s assets rather than income and can be outright gifts, deferred gifts or a combination of the two.

Each of the deferred giving instruments summarized below is closely regulated by law and requires special arrangements and tax treatment.

Bequest in a Will or Living Trust
A bequest is a gift made through a will or living trust. The University is often named beneficiary in the wills and living trusts of alumni and friends. Bequests may be stated as a percentage of the estate, as the residual of the estate or a specific dollar amount. A specific bequest from a tax-deferred retirement account is advantageous to the donor’s estate because unpaid taxes, normally due at the time of distribution, are not paid by Oakland City University. Since a will can be changed, no income tax benefits are associated with a bequest; however, the donor’s estate is reduced by the amount of the bequest for estate tax purposes.

The drafting of your will or living trust should be arranged with your attorney. Oakland City University representatives are available to confer with you and your attorney in drafting the appropriate bequest clauses.

Charitable Remainder Unitrust
In this case, the donor transfers cash, real estate or securities to an irrevocable trust that provides yearly, fluctuating income of five percent or more to the donor or other beneficiaries for a specified term or for life. Trust assets are revalued annually, allowing potential growth in income to the beneficiaries. Additional contributions can be made to the trust. Upon the death of the final beneficiary, the charity receives the principal and distributes it according to the donor’s wishes. An income tax deduction is allowed for an amount equal to the present value of the University’s remainder interest in the trust.

Charitable Gift Annuity
The charitable gift annuity is a contract between the University and the donor whereby the University promises to pay a fixed annuity to a maximum of two beneficiaries (beginning immediately or deferred to a later date) in exchange for the irrevocable transfer of assets by the donor to Oakland City University. Annuity payments are based on the initial market value of the assets contributed and the ages of the income beneficiaries. For donors of retirement age, the payments generally far exceed what could be expected from ordinary fixed income investments thus increasing the annual income stream. A portion of the annuity payment may be considered a tax-free return of principal. An income tax deduction is allowed for the difference between the value of the gift and the present value of the annuity.

Deferred Gift Annuity
Like a standard gift annuity, a donor makes a gift now and receives an immediate income tax deduction; however, the donor begins receiving the annuity payment at a future, predetermined date. Because of compounding between the date of gift and the first annuity payment date, the amount of the annuity payment can be significant and at a greater rate than that of the standard charitable gift annuity.

Retained Life Estate
A donor may transfer a personal residence or a farm to the University, while retaining the right for the donor and spouse to live there for life. The donor will be entitled to a charitable income tax deduction for a portion of the appraised fair market value of the property at the time of the transfer. In addition, the donor escapes capital gains tax on the property’s appreciation.

Retirement Accounts
A donor can name the University as primary beneficiary of a retirement account with the value being fully deductible for estate tax purposes. Furthermore, taxes on income in respect of a decedent (IRD) is avoided since the University is a tax-exempt entity. IRD is taxable to noncharitable beneficiaries, even if no estate tax is due.

Life Insurance
Life Insurance can become a gift more valuable than the actual money expended when the policy is given to the University, which is named as the beneficiary. Three different giving opportunities are available with life insurance. First, a donor can contribute a “paid up” policy to the University and receive an income tax deduction equal to the policy’s cash/replacement value. Second, a donor can name the University as primary beneficiary of the policy, resulting in estate tax savings, but no income tax deduction. Third, a donor can name the University as owner and beneficiary of a new policy and receive an income tax deduction for an annual gift in the amount of the premiums.

Endowment
An endowment is a fund created by a donor who specifies that the gift not be spent, but retained permanently. The income is used for either unrestricted or for specific purposes such as a named scholarship fund. The advantage of making an endowment gift to Oakland City University is the perpetual benefit to the Oakland City University community of scholars enabled by the endowment fund’s continual earnings. A permanent source of endowment income provides a steady stream of income thus helping to preserve the rich Oakland City University heritage of academic excellence.

Endowment Management
The Oakland City University Investment Committee of the University Board of Trustees meets regularly to review the investment results and to give direction to the University Administration and the investment professionals who manage the endowment funds on a daily basis. The policy guidelines given to the investment managers is to maintain a conservative mix of both equities and fixed income securities.

The principal value of each individual fund is determined as of the close of business May 31st of each year. A portion of that value, currently 4.05 percent, is made available to the purpose for which the donor intended. Any unused income is added to the principal amounts thereby making long term growth possible. Donors may also make additional gifts to their respective funds thus accelerating the growth of available income.

If you have questions for the Office of Development, please call 812-749-1212 or send an e-mail to jticheno@oak.edu. Mail inquiries may be sent to:

Oakland City University
Office of Development
138 N. Lucretia Street
Oakland City, IN 47660