In today’s fast rising stock market, many people are holding highly appreciated stocks that produce little income or they are hesitant to sell because of high capital gains taxes. Many others own a life insurance policy that they no longer need but are reluctant to cash in because of the tax liability. And still others are looking for ways to reduce the estate tax burden on heirs.

If any one of these scenarios sounds familiar to you, then you might be interested in the American Psychiatric Foundation’s new planned giving program.

The American Psychiatric Foundation is the charitable arm of APA, providing grants to individuals and other nonprofit organizations to improve the treatment of mental illness and increase accessibility to needed mental health services. The foundation also provides grant support to the American Psychiatric Institute for Research and Education. Established in 1991, the foundation is supported by contributions of individuals, corporations, and other organizations.

Through the foundation’s planned giving program, you can support foundation initiatives to improve the treatment of mental illness and increase accessibility to needed mental health services, while at the same time enjoying extensive tax benefits or even income for life. Planned giving is a specialized type of charitable giving that provides significant tax and income benefits for both you and your heirs that are not normally associated with traditional giving.

Foundation President Abram M. Hostetter M.D., kicked off the planned giving program by establishing a charitable trust to benefit the foundation. Said Hostetter, "I believe strongly in the foundation’s ability to make a major impact on psychiatry. Planned giving provided me with the opportunity to support a cause I believe in."

The foundation now offers four different ways for you to make a planned gift:

• Bequests: You can make a provision in your will for either a set amount or portion of your estate to be contributed to the foundation. Bequests, at their full market value, are excluded from your taxable estate, thereby reducing the tax burden on your heirs.

• Charitable Remainder Trusts: This type of planned gift is ideal for individuals holding highly appreciated securities that produce little or no income. By placing these assets in a trust ($100,000 minimum) managed by the foundation’s professional investment advisor, you receive a significant tax deduction (the amount is dependent on your age), avoid capital gains tax, and enjoy an annual income (you can either take a fixed percentage or amount) from the trust for life or a predetermined number of years. Upon your death, the assets of the trust become part of the foundation’s endowment.

• Pooled Income Fund: Your gift to the Pooled Income Fund ($5,000 minimum initial contribution, $1,000 minimum subsequent contribution), either in the form of cash or securities (full market value), is combined or "pooled" with those of other donors and invested in income-producing instruments such as bonds. The fund is professionally managed by the foundation’s investment advisor, and all income generated by the fund is distributed each quarter to donors based on the amount of "shares" each owns. You receive a tax deduction for your contributions (the amount is dependent on your age), and you avoid capital gains tax on any appreciated securities you contribute. Upon your death, your shares in the fund become part of the foundation’s endowment.

• Gifts of Life Insurance: This can often be the easiest gift to make. Most people have life insurance policies, many of which have outlived their original purpose. By contributing your policy to the foundation, you will be entitled to a tax deduction for its full cash value. Any remaining premiums on the policy that you pay are also tax deductible. You can also add the foundation as a beneficiary of a policy, which means its proceeds will not be included in your taxable estate.

Planned giving donors will be entitled to membership in the foundation’s Legacy Society. Members will be recognized and thanked in numerous venues and publications and will receive additional benefits such as special invitations to foundation events and activities.