PYRAMID. Norma and Albert Geller Receive Crile Award. Are you one amongst many, or are you someone who makes a difference in the world?

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1 PYRAMID Ideas on financial, estate and gift planning for friends of Cleveland Clinic FALL 2015 Norma and Albert Geller Receive Crile Award Al and I are greatly appreciative of this wonderful honor, Mrs. Geller said. So, many of you might ask, Who are the Gellers, and why do they do what they do? I will answer with Al s wonderful mantra, You only go through life once, so make a difference! She noted that she and her husband, who support medical research and patient care at Cleveland Clinic, came from humble beginnings but were taught to share. Mr. Geller worked his way through Cleveland College while helping the owners of Fish Furniture, which eventually came to be their business. Crile Award recipients Norma and Albert Geller with son Daniel Geller, left Speaking at the annual Partners in Philanthropy celebration on June 23, Norma Geller described her favorite cartoon. A man counsels a fish: Say to yourself: Am I just a fish swimming in the sea, or can I be the first to crawl up on land? Addressing the audience, she asked, Are you one amongst many, or are you someone who makes a difference in the world? Mrs. Geller and her husband, Albert Geller, were honored as people who make a difference when they received the George W. Crile Sr. Award at the event. Instituted in 2003 in commemoration of one of Cleveland Clinic s founders, George Crile, MD, the award recognizes longstanding service, extraordinary commitment and outstanding contributions of time, talent and resources to the mission of Cleveland Clinic. Are you one amongst many, or are you someone who makes a difference in the world? Norma Geller We are thankful for our blessings and feel the importance of sharing and giving back, Mrs. Geller said. Cleveland Clinic has been a very important part of our blessings. In the 1990s, we both underwent successful cardiac surgeries, which we attribute to the expertise of skilled physicians. Therefore, we felt the need to act in appreciation. We give from our hearts, both figuratively and literally, and are aware of the need for funds for research, translational medicine and facilities such as the new center that will open on Carnegie Avenue for outpatient cancer patients. Continued on page 3 Inside This Issue 2 News from the Gift Planning Team 3 Cleveland Clinic Florida Fan Supports Cancer Programs 4 Life Income Gifts 7 Q&A: Life Income Gifts 7 Complimentary Booklet 7 Allied Partners in Philanthropy New Pyramid Legacy Society Members 8 Centennial Campaign Commitments 8 The Power of Every One

2 News from the Gift Planning Team Greetings! As 2015 draws to a close, I would like to express our deep appreciation for all philanthropic supporters of Cleveland Clinic, including those of you whom my colleagues and I have had the privilege of assisting with planned gifts. This past year at Cleveland Clinic will be remembered for many exciting medical achievements that your generosity helped make possible. The Power of Every One Centennial Campaign continues to generate excitement, and we already are seeing results, such as the amazing progress in building the outpatient Cancer Center. This revolutionary new space will accommodate all disciplines of oncology, as well as accelerate one of the nation s most robust cancer research programs. Ground was broken on Oct. 1 on another major campaignsupported capital project, the new Health Education Campus. Cleveland Clinic and Case Western Reserve University (CWRU) have joined in a historic partnership to advance medical education for future generations. I am grateful to all of our benefactors who are helping to make these and other important initiatives possible. In this issue of Pyramid, you will learn about Barry Grimson, a Florida resident supporting our Campaign for Cleveland Clinic Florida. You also will meet this year s George W. Crile, Sr. Award recipients, Norma and Albert Geller, whose giving reflects Al s philosophy, You only go through life once, so make a difference. Finally, walking the halls of Cleveland Clinic reminds me of the life-changing events that take place here every day. We are grateful that so many patients lives are saved and improved by the research we conduct and the medical care we provide. With your help, we will continue on this path for many years to come. Warm regards and happy holidays, From left, Katherine Collin, Esq., Nelson J. Wittenmyer Jr., Esq., Anne Corrette, Richard Hilbrich, Esq., Amanda Steyer, Esq. Jamie McHenry joined our gift planning team this summer as an intern. She grew up in Rocky River and graduated from Magnificat High School. She is a proud alumna of the University of Cincinnati, where she received a degree in paralegal studies, and is now in her third year at Cleveland Marshall College of Law. Jamie is a welcome addition to our team. Nelson J. Wittenmyer Jr., Esq. Vice Chair Philanthropy Institute 2

3 Cleveland Clinic Florida Fan Supports Cancer Programs Barry Grimson Barry Grimson likes his communities small and relaxed and his medical centers large and experienced. That s why he joined a group of fellow Weston residents who championed Cleveland Clinic Florida s move there from Fort Lauderdale in Recently, Mr. Grimson, long retired from the medical electronics business, decided to leave Weston because it wasn t a small community anymore. A town of 5,000 people when he arrived in 1988, Weston has boomed and boasts a population of around 55,000. My new community, Boynton Beach, is like Weston was 25 years ago, he says. It s only about 1,100 homes and laid-back. However, despite moving 40 minutes away, he won t leave his doctors at Cleveland Clinic Florida. I feel that Cleveland Clinic Florida and the doctors I know are top-notch. I take good care of myself, have a physical every year and address any health problems right away. I work out and do water aerobics classes. I feel that you have to be proactive with your healthcare, and I m very happy with Cleveland Clinic. In 2009, Cleveland Clinic Florida became even more important to him when his wife, Marcia, fell ill on their return from a vacation in Iceland. She was diagnosed with sarcoma, a rare kind of cancer found mainly in bone and soft tissue. She was gone within only two weeks, he says. I didn t get a chance to say goodbye. Since then, Mr. Grimson has supported cancer programs at Cleveland Clinic Florida and recently made a planned gift in his wife s memory to the new Maroone Cancer Center. When my wife passed away, I felt very committed to funding anything dealing with cancer, he says. I feel good making this gift to Cleveland Clinic Florida. Elaine DeRosa Lea Continued from page 1 Norma and Albert Geller Receive Crile Award They also serve on the Taussig Cancer Institute Leadership Council and have made gifts establishing the Geller Transportation Fund, which allows social workers to provide tax vouchers or van rides for cancer patients who lack transportation to their appointments. I am a cancer victor, a former oncology social worker, and a hospital volunteer in radiation therapy, she said, so the importance of getting to treatment was the impetus for the establishment of the Geller Transportation Fund. We do hope to endow the fund in the future, so that it can go on in perpetuity. The couple s own treatment for cancer and heart disease moved them to make a gift of life insurance, she said. This will help Cleveland Clinic with future heart and cancer research. It is a way to show our appreciation for all the help Cleveland Clinic gave us in the past and has given to this day. It is our way, as Al professes, to make a difference. Elaine DeRosa Lea Norma Geller with Brian Donley, MD, Cleveland Clinic Chief of Staff powerofeveryone.org 3

4 Life Income Gifts As the year ends, we often find ourselves being thankful and deciding how best we can give back so that others can benefit and be thankful, too. If you have charitable objectives, options are available that can provide advantages to you and support your favorite charity. One such choice is receiving income for life by making a gift. You can make a gift and receive income for life You might wonder how that can be. The answer is a life-income, or split-interest, gift. In other words, you re making a gift to Cleveland Clinic and, in return, receiving income for life. The remainder will benefit the area you ve chosen to support. Two types of gift options offer this advantage: a charitable gift annuity (CGA) and a charitable remainder unitrust (CRUT). A CGA provides the security of receiving a set amount each year, and it s guaranteed to be received for life. Alternatively, the payments from a CRUT will fluctuate with the market, offering the possibility of greater income if the market does well, but also the risk of payments decreasing in a downward trend. Charitable Gift Annuities Of those two options, a charitable gift annuity (CGA) is more popular because of its simplicity, and it offers a variety of benefits to a wide range of individuals. A CGA often is the gift of choice because it is an uncomplicated agreement between you and Cleveland Clinic. In its most basic form, you would make a gift to Cleveland Clinic, and in return, you would be guaranteed the same annual income for your lifetime. That income would be based on a payout rate specific to your age. Older beneficiaries will enjoy a greater percentage than younger ones. For example, an 80-year-old would receive a payout rate of 6.8 percent, and a 70-year-old would receive 5.1 percent. Either way, the payout most likely would be much higher than other popular income-producing investments such as CDs, money market funds or bank savings accounts. For tax purposes, your contribution for a gift annuity is treated as two transactions: one portion is a gift to Cleveland Clinic, and the rest is an investment in an annuity. You would receive a charitable deduction in the year your contribution was made. The additional tax advantage is that for your expected lifetime, part of your income will be tax-free. $10,000 Sample Gift Annuity One Beneficiary ANNUAL TAX FREE CHARITABLE TAX TAX SAVINGS IN AGE RATE INCOME FOR LIFE PORTION DEDUCTION 28% TAX BRACKET ,002 1, ,503 1, ,622 1,574 Two Beneficiaries YOUNGER OLDER ANNUAL TAX FREE CHARITABLE TAX TAX SAVINGS IN AGE AGE RATE INCOME FOR LIFE PORTION DEDUCTION 28% TAX BRACKET , ,002 1, ,540 1,271 4

5 Building for the Future Since charitable gift annuities are so simple, and yet versatile, people often establish more than one. Some start with one small annuity, perhaps $10,000, and as circumstances permit and the many benefits have been enjoyed, add more annuities. In this manner, future income is secured, such as for retirement. Deferring Income Another way to supplement retirement funds is to defer gift annuity payments. Retirement plan investment return fluctuations have made it more difficult than ever to predict exactly how much income you will have when you retire. A deferred payment gift annuity is one creative strategy that allows you to fulfill your philanthropic goals, lock in a higher fixed annuity now for when you retire, and enjoy immediate tax benefits. Example* Caroline is 55 years old and wants her payments to begin when she retires at 67. A deferred payment gift annuity allows her to plan a gift while also planning her future. She transfers appreciated stock valued at $73,425 with an original cost basis of $35,000 to Cleveland Clinic. Using appreciated stock offers her an additional benefit of avoiding some or all of the capital gains tax. If she were to liquidate the stock without giving it to Cleveland Clinic, she would owe capital gains tax on the $38,425 increase in value. Without deferring the income, Caroline s gift annuity rate would be 4%, but because she will not begin receiving payments until she retires, her annuity rate instead will be 7%. Beginning at age 67, she will receive an annual income of $5,140 for the rest of her life. Her charitable deduction of $27,949 will reduce her taxes this year by $7,825 in her 28% tax bracket. She is happy that she locked in a high rate of return that is guaranteed to be paid to her for life once she retires. * The examples in this newsletter are not based on actual benefactors but represent realistic illustrations of various gift planning opportunities. If you would like to know how these opportunities might apply to your situation, please contact Cleveland Clinic or your financial advisor. Charitable Remainder Unitrusts Another option to consider is a charitable remainder unitrust (CRUT). With a CRUT, you transfer cash or other appreciated asset(s) into the trust and your payments are distributed from and secured by the assets in your trust. The trust can be established for a lifetime or for up to 20 years and will provide annual payments to you and/or your named beneficiary(ies). By law, distributions must be at least 5 percent of the trust s value annually. Because the trust s value fluctuates, your annual payment will, as well. Example* Joseph and Nancy are both 67. They provided well for their children, who now are adults and financially comfortable. It s time for them to enjoy retirement, and they would like to have more cash on hand to travel. They purchased stock years before for $40,000 that now it is worth $100,000. They wish to use this stock to fund their travel while also making a gift to support Cleveland Clinic. If they sold the stock, they would owe capital gains tax of $9,000 on the $60,000 gain ($60,000 x 15%). They would have only $91,000 to reinvest, which, at 5%, would yield $4,550 annually. They decide that this will not fulfill their goals. After speaking with their advisor, they decide to create a charitable remainder unitrust that will pay them 5% of the trust s value each year for as long as either of them lives. They do not have to pay the $9,000 capital gains tax on the $60,000 gain if they transfer it directly to the new trust. They also benefit from a charitable deduction of $36,574. In their 28% tax bracket, they save $10,241 this year in federal income taxes. Because of their unitrust, Joseph and Nancy create income of approximately $5,000 for the first year, and as trust assets increase in value over time, their annual income will increase. Average annual payments may be $6,174, and over their lifetime, they may receive back more than their original gift. At the end of the trust, Cleveland Clinic also expects to have more than the original $100,000 gift to support the medical area the couple has chosen. powerofeveryone.org 5

6 Continued from page 5 Similarities and Differences Charitable remainder unitrusts and charitable gift annuities have several benefits in common. Both can be funded with cash and/or other appreciated assets, and they can support your parent, child or other individual with additional income. Both offer tax advantages while you continue supporting your family. At the end of the term of the trust and the gift annuity, the remainder is distributed to Cleveland Clinic to support your area of choice. A significant difference between them also is important to consider. One guarantees a set income for life (CGA), while income from the other (CRUT) fluctuates with the market, offering a hedge against inflation. If you wish to learn more about how a CGA or a CRUT may fit your financial and charitable plans, and would like assistance from one of Cleveland Clinic s gift planning professionals, please call , Ext , or , or send a message to a.corrette@ccf.org. Ways a CGA and a CRUT May Benefit You Combines a gift with payments to you and/or loved ones Provides partly tax-free income Lowers income tax Reduces capital gains tax (if funded with stock) Supplements retirement income Provides potential estate-tax savings Avoids management responsibilities Supports Cleveland Clinic Make a Gift of Appreciated Stock for Added Benefits One of the best ways to improve your investment portfolio is to use your appreciated stock instead of cash to make a charitable gift. Both CGAs and CRUTs can be funded with appreciated stock and enjoy the double benefit of avoiding some of the capital gain while funding your gift with the current market value of the stock. You then can use the cash you originally planned to use for your gift to Cleveland Clinic to replace the stock you gave. This way, no matter in which direction the market moves, you will be better off than if you had kept the stock and given cash. Here s why: Making a charitable gift of long-term appreciated stock allows you to deduct its full fair-market value not the original cost. When you buy the replacement stock, you establish a higher basis. If its value then rises, you will be taxed on a smaller amount of gain when you decide to sell it. Even if the stock goes down, you still are ahead. The loss you incur if you sell will be measured against the new higher price you paid to replace the stock rather than what you paid for the gifted stock. This will create a larger loss for tax purposes that can be netted against any gain or used to offset a limited amount of ordinary income. Comparison of CGA and CRUT CHARITABLE CHARITABLE GIFT ANNUITY REMAINDER TRUST Lifetime Income Provided 4 4 Charitable Tax Deduction 4 4 Choose Term 4 Tax-Free Return of Principal 4 4 Payments Backed by CCF Assets 4 Choose Income Beneficiary 4 4 Additional Income Beneficiaries 4 Volatility Low Medium Possible Funding Assets Cash; Appreciated Cash; Appreciated Securities; Securities; Marketable Marketable Real Property Real Property Minimum Gift Amount $5,000 $100,000 6

7 New Pyramid Members 2015 The Pyramid Legacy Society was established in 1992 to honor and show appreciation to all patients, friends and alumni worldwide whose support is building a legacy for Cleveland Clinic through their charitable gift plans. Anonymous Friends Katherine E. Collin, Esq. Bertrand P. Collomb E. I. du Pont de Nemours and Company Norman and Constance Kotoch Judith K. Lezotte Dale and Barbara Markowitz William A. and Blair A. McSpadden Janet L. Moxley William K. O Brien and Ming Chang O Brien Susan C. Scott Jay and Lana Schwartz George R. and Mary R. Stark Susan and John Turben Foundation Allied Partners in Philanthropy 2015 Allied Partners in Philanthropy (APP) is a society established by Cleveland Clinic to thank and recognize allied professionals (attorneys, accountants, bankers, brokers, financial planners, etc.) who have helped facilitate a charitable gift to Cleveland Clinic. This year we would like to especially acknowledge The Burgess Group for their outstanding partnership with Cleveland Clinic s Philanthropy Institute. Special thanks to: Elizabeth K. Burgess, TEP, JD Steven A. Burgess, TEP Zach A. Burgess Brian McPhail Todd A. Reid, JD, CLF If you have assisted your client with a gift to Cleveland Clinic, please contact Amanda Steyer, Esq. at Or send an to steyera@ccf.org. Complimentary Booklet Ways to Give Giving and receiving may be the best attributes of both charitable gift annuities and charitable remainder unitrusts. Our Ways to Give brochure outlines these options and a variety of additional gift plans. You may find the right one for you and your family. To request a copy of this brochure, please complete and return the prepaid reply card. If you wish to discuss, in confidence, a plan that best suits your family and charitable needs, please call Cleveland Clinic s gift planning professionals at You also may send an request to a.corrette@ccf.org. We look forward to assisting you. Q&A Life Income Gifts Amanda Steyer, Esq. What is a life income gift? A life income gift is a popular gift planning tool that allows you to fulfill your personal financial goals, family obligations and philanthropic objectives all in one planned gift. How does it work? A life income gift is an agreement between you and Cleveland Clinic. You make a gift to Cleveland Clinic and in return, you and/ or another person will receive an income for life or a term of years What type of life income gift is right for me and my family? If you want to receive set income payments for the rest of your life, and/or the life of another person, a charitable gift annuity could work for you. If you want to receive an income stream for a particular number of years and one that fluctuates with the market, a charitable remainder trust could work for you. Both options offer features that can be used to provide financial and tax benefits for you and your family while helping to secure the future of Cleveland Clinic. What are the tax benefits? Allow you to qualify for an immediate charitable income tax deduction Your income payments may be partially tax-free You will have capital-gains tax advantages if the gift is funded with an appreciated asset such as stock You may see gift and estate tax savings powerofeveryone.org 7

8 The Cleveland Clinic Foundation Philanthropy Institute 9500 Euclid Avenue, Cleveland, OH powerofeveryone.org Centennial Campaign Commitments (Goal: $2 billion) $1 billion $800 million $741 million $711 million $686 million The Power of Every One In June 2014, Cleveland Clinic kicked off its historic centennial campaign, The Power of Every One. With a goal of $2 billion, this is our most ambitious philanthropic effort ever, one that will help us remain at the forefront of healthcare and allow us to build on our legacy of healing and promoting medical innovation. Our founders unwavering focus on patients, coupled with a culture of innovation, changed the way healthcare was delivered. Today, Cleveland Clinic is leading a shift from sick care to well care. We have a unique opportunity to set an example of effective, efficient healthcare for the nation and the world. But we can t do this without you. With the decline of federal and corporate funding and the rise of healthcare delivery costs, your support is more critical than ever. For this campaign, we have identified four strategic areas: $637 million Promoting Health Training Caregivers Advancing Discovery Transforming Care $600 million CAMPAIGN KICKOFF June Sept. Dec. Mar. June Sept For nearly 100 years, Cleveland Clinic has been providing, reimagining and reshaping healthcare. Now, with your help, we will set our course for the next century. PYRAMID Anne S. Corrette: Pyramid Editor and Director of Gift Planning Elaine DeRosa Lea: Communications Manager VOLUME 23 ISSUE 1 Contact Us We are here to help. If you would like more information about making an outright or a planned gift to support Cleveland Clinic, you may contact us: 2015 The Cleveland Clinic Foundation Pyramid is published by the Philanthropy Institute for friends and benefactors of Cleveland Clinic. Its purpose is to identify opportunities that may be helpful in your charitable giving as well as your tax and financial planning. Please consult your professional advisors as to the applicability of any item to your situation. Cleveland Clinic, founded in 1921, integrates clinical and hospital care with research and education in a private, not-for-profit group practice. Cleveland Clinic depends on the generosity of individuals, families, corporations and foundations to ensure its continued excellence in patient care, medical research and education. Cleveland Clinic realizes that individuals would like to learn more about particular programs, services or developments. We also fully respect the privacy of our patients. If you do not wish to receive any materials containing such information, please call or write to the Philanthropy Institute/DV3, 9500 Euclid Avenue, Cleveland, OH Visit us online at clevelandclinic.org/giftplanning Return the attached reply card Call us toll free at Ext or us at a.corrette@ccf.org