USD Magazine, Winter 2001

HE TAUGHT THEM WELL Law pro fessor·s former students raise money to l1elp o tllers get degree.

H ugh Friedman likes ro joke chat he is the School of Law's "resident artifact. " An expert in business law, Friedman began teaching at USD in 1958, when classes were held in Quonset huts on the Uni high school campus across Linda Vista Road and the law school had yet ro be accredited by the American Bar Association. When the law school finally moved ro its current home in Warren Hall, the faculty loaded up the books in che law library and carried them across the road by hand. By 1998, some 90 faculty were teaching at a School of Law that had developed inro one of the most prestigious on the West Coast. And ro recog– nize Friedman's 40th anniversary of teaching, a dozen former students decided an endowed scholar– ship in his name would be the best present. "When we approached him ro get his blessing for the scholarship, he was very surprised," says Jerry McMahon '64, a former Friedman student and now a member of the San Diego law firm of Seltzer Caplan McMahon Vitek. The scholarship is designated for third-year law students who have a demonstrated interest in pursuing business law. Friedman's former students gathered some $70,000 from alumni to endow the scholarship; Friedman and his wife, Lynn Schenck, a School of Law alumna and chief of staff ro California Gov. Gray Davis, also contributed.

FINANCIAL AID FACTS Only 2 percent of USO alumni don't repay their student loans on time, giving USO one of the lowest default rates in the nation.

The American Corporate Counsel Association, San Diego Chapter, added $ 1,500 in each of the first two years of the scholarship's existence. Like most of USD 's scholarships, the amount credited ro the stu– dent's account - about $5,000 - is interest the endowment earns each year. "There are many financial needs in higher educa– tion, but I have always thought student scholarships are the most important," says Friedman, who received scholarships both for his undergraduate

degree in English literature from Yale and his law degree from Stanford. "There is nothing we can do chat better serves the univers ity and our profession than help

promising students succeed." T he scholarship represents about a third of the annual tuition cost for the evening law program. "I hope ic provides many, many opportu– nities for students ro challenge themselves and contribute ro the profession," he says.

CREATIVE FINANCING ~g How to pay for a college education, be philanthropic and get a tax break to boot -· Suppose you've made some "With the way tax laws were struc- wise investments over the cured 20 years ago. and because not too years and find yourself sitting on a many people back then had the money

For more information on charitable remainder cruses, check with an estate planning attorney or call USD's Office of Planned Giving, (619) 260-4621.

dation as the beneficiary, which allows you to bypass the capital gains cax and get a cax deduction over several years. Once the trust is established, you can then have it pay out the cost of your child's or grandchild's education over, say, five years. At the end of the term, the remainder of the money in the crust

up front to pay for a family member's college education, this wasn't a real option," says attorney Cheryl H. Dean, acting director of USD's office of planned giving."Now the laws allow you to effectively give some of what you have earmarked as an inheritance today,

pile of stocks and assets. You wane co use some of chat money to help pay for your child or grandchild's college educa- tion, but you also would like co see some of it go co a charity, a foundation Bue you're worried: Once you cash in chose assets, you'll be greeted by Uncle Sam reciting three scary words - capi- Through a little-known option with an unwieldy name - charitable remain- der cruse for a term of years - Uncle Sam allows you co achieve your family's education and philanthropic goals with- or your alma macer. cal gains tax.

Changes in the federal tax code also allow anyone to create a tax– deferred savings account to pay for a college education for themselves, a child or relative. The maximum amount allowed to be deposited each year varies by state, but can grow tax-deferred until withdrawn for tuition, books or room and board. To find out about the pro– gram in your state, contact the College Savings Plan Network at (877) 277-6496.

goes co the designated charity.

Dean says the money can go co any SO I(c)(3) non-profit organization,

and gee a cax deduction."

Here's how the cruse generally

including USD.

works:

"It can be set up so at the end the money goes co an endowed scholarship, or it can be directed co a certain project at the school," Dean says."Let's say the child turns out co be a phenomenal biol- ogist.You could designate the proceeds

Lee's say you invested $ I00,000 years ago, which is now worth $300,000. If you sold your investments, you'd likely pay capital gains taxes on the $200,000. Instead, you place it in the trust, desig- nacing a nonprofit organization or foun-

out getting socked by taxes.

for a lab."

17

WINTER 200 l

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