Smart Ways To Give
Giving Alternatives in Uncertain Times
April 2009
The unprecedented financial turmoil of the last six months has resulted in reduced giving in a time when demand for charitable services is increasing. The following are some giving alternatives to you should consider. Please call us at 901-682-6201 for additional information.
Non-cash gift options. Did you know that non-cash assets represent 90% of America’s wealth? While giving appreciated stock is the most common giving alternative, the stock market has erased approximately ten years of capital appreciation over the past six months. Consider giving stock purchased twenty or thirty years ago. This can eliminate significant capital gains taxes and a charitable deduction at current market value. Real estate, intangible and tangible personal property are three non-cash gifts options to consider.
Real estate. We have a subsidiary entity designed to receive such gifts.
Intangible personal property such as copyrights, royalties, patents, personal service contracts, installment obligations, life insurance and annuity contracts, business and partnership interests.
Tangible personal property such as vehicles, boats, RVs, timeshares, jewelry, collectibles and business inventories and equipment. We have developed partnerships to help dispose of these items which sometimes can be difficult.
Giving for Income. This is giving which provides a certainty of return income. A Charitable Remainder Trust and creating a Bridge to Retirement are two such vehicles to insuring giving with a return of income.
Charitable Remainder Trust (CRT) provides income for life and can be funded with non cash appreciated gifts such as collectible to save capital gains taxes (which are 28% for collectibles).
Create a bridge to retirement – a charitable remainder trust with a specified term such as 10 years. A 10 year CRT with a 10% payout can return your entire donation and still leave value for your donor advised fund or the charity of your choice.
Provide for others such as parents living expenses or children’s educational expenses with a CRT.
Create or rebuild a retirement plan with charitable gift annuities or CRTs – please call us for more information.
Temporary Giving. Just as you would with a loan, temporary giving allows for you to give and then to get back over time. A Charitable Lead Trust is an excellent option to consider.
A Charitable Lead Trust (CLT) provides income to your donor advised fund or charity of your choice for a specified term. At the end of the term, the balance reverts to your children or grandchildren. A CLT can substantially reduce estate taxes while preserving the estate.
Provide an interest free loan up to $250,000 per charity. This also will allow you to avoid imputed interest.
Use funds from an IRA for charitable gifts and pay no taxes. This applies to donors specifically over the age of 59.5
Use proceeds from cashing in your U.S. Savings Bonds for charitable gifts and pay no taxes.
Life Estate Agreement – Donate your residence to charity, retain use for life and receive tax deduction now.
Include a charitable bequest in your will to your donor advised fund or charity of your choice.
Please call us at 901-682-6201 for more information on any of these alternatives.
