Hamilton College & Donors Benefit From IRS Ruling

The Internal Revenue Service has issued to Hamilton College a special ruling that allows the college to invest charitable remainder trusts with its endowment. These charitable gift vehicles will benefit from increased diversification and growth potential.

In late December, Hamilton College, Princeton University, Amherst College and the University of Rochester joined Harvard, Stanford and M.I.T. as recipients of similar private letter rulings or PLRs.

Charitable remainder trusts make fixed or variable payments to donors or named beneficiaries for life or a term of years. In addition, donors enjoy income, capital gains and estate tax savings. Upon termination, the trust assets are used according to the wishes of each donor, typically to establish an endowed fund at Hamilton, such as a professorship or scholarship.

Donors and Hamilton College have a mutual interest in trust appreciation to meet the donors' philanthropic objectives and college's needs. In addition, donors receive increased payments when the assets of variable payment trusts grow.

Through access to investments generally not available to charitable remainder trusts, this IRS ruling allows significant diversification and growth potential. Hamilton's endowment investment performance has ranked among the best in the country, achieving a 12.2% total average annual rate of return for the 10-year period ended June 30, 2006.

Alumni, parents and friends continually demonstrate Hamilton's tradition of philanthropy that dates to the founding of the Hamilton-Oneida Academy in 1793. The college regularly achieves one of the highest rates of annual fund participation among colleges and universities in the country and has completed five successful capital campaigns in the last 30 years. Every year, Hamilton receives dozens of planned gifts—charitable remainder trusts and charitable gift annuities—ranging from several thousand to several million dollars each. Included in the college's portfolio of more than $705 million under management are planned gifts of $77 million.

For additional information about charitable remainder trusts at Hamilton College, contact Ben Madonia, director of planned giving, at 315-859-4669.