WHAT IS PLANNED GIVING?
"Giving" refers to a wide variety of ways a Donor to give to charity during their lifetime and/or after their death. The aspect to “Planned” Giving is that an additional objective is to continue to meet the donor’s current income needs and provide for the Donor’s heirs.
Planned giving is an important branch of my Estate Planning/Asset Preservation practice. The good news is that Planned Giving can be done for Donors of nearly all income and asset levels.
For the Donor, Planned Giving has many advantages. First there is the satisfaction of helping a charitable organization in its work. It is also a way to make larger gifts than normally possible from current assets, can provide for a lifetime income, provide a much better return on investments, affords significant reductions in Income Taxes, Capital Gains Taxes and Federal Estate Taxes (now up to 48% and scheduled to go to 55% in the 2011!), and can be used as a means of sheltering assets from judgment creditors.
Planned Giving is a valuable means of allowing Donors who want to benefit a charitable organization to be certain they will have not only the ability to assist the organization but to ensure they will have sufficient assets available to themselves and their families to meet their needs during their lifetimes.
Planned Giving can be used as a way to benefit non-profit organizations that are qualified under IRC§501(c)(3). These types of organizations include schools and colleges, hospitals, public service organizations, the SPCA, AANR Education Foundation and many others. Of course before making a gift expecting favorable tax treatment, it is essential to confirm the organization’s non-profit status.
PLANNED GIVING OPTIONS
The most common types of planned giving vehicles are Gift Annuities, Charitable Lead Trusts, Charitable Remainder Trusts, Inter Vivos Gifts, Testamentary Bequests and Beneficiary Designations. By clicking on the above links, they will take you to a page where each of these approaches are discussed in greater detail.
BE CAUTIONS WHEN MAKING GIFTS
There are a multitude of organizations that are activly seeking your financial contribution. While most of them are legitimate and working to meet important needs in helping others, there are some that just say they are. Before making any contribution to any organization, make certain that they are who they say, what they say, and actually doing what they say.
Questions for Any Organization You Are Concidering Making a Gift To:
1. Do they have 501 (c)(3) status by the IRS?
2. How long have they been in existance.
3. Do they have audited financial statements? If so, are they available to you?
4. What have they accomplished in the past, and is it documented?
5. What is the ratio between administrative costs and actual charitable expenditures?
6. Have they been charged with any violations of the law or had fines levied against them.
7. Who are the officers and directors of the organization and what are their salaries?
8. Are they recognized by any other organizations?
9. Have they received any awards or commendations for their work?
10. Where are their offices and other physical locations?
These are not all of the questions that could be asked of a representatative of an organization to decide if they are legitimate. However, if the answers to these questions do not sound right, then probably it is worthwhile to find a different organization to benefit with your charitable gift.
One additional important indication of the nature of an organization is are they trying to use a "hard close" to persuade you to donate to their organization. While all charibable organizations are quite happy to receive financial support, an organization that tries to force someone to donate is probably a scam.
Remember, once you make a gift, it is gone. So think before you write that check!