Planned giving is an organized approach to giving that evaluates the donor’s personal values, selects charitable organizations and gift-giving vehicles that best reflect those values, and maximizes the financial and tax benefits of the gifts.
Planned gifts provide flexibility and personal control for you to create the type of major gift that fits within your family and financial goals according to a timeframe that is best for you. Planned gifts can provide:
- Annual Income for you and your loved ones in tax advantaged ways;
- Tax Savings through charitable deductions and capital gains tax relief;
- Gift and Estate tax savings realized by gifting estate assets;
- Personal Satisfaction of knowing you have made a meaningful difference.
The options for making planned gifts are many. They include bequests made through wills, charitable remainder trusts, charitable lead trusts, charitable annuities, and donor-advised funds, to name only a few. Each option presents advantages and disadvantages, so you will want to review those options with your financial planner to see which ones best fit your values and personal financial situation.
Wills. After providing for personal bequests, you may include provisions for setting up a fund or adding to one you already have. You will save estate taxes and assure that the charitable work you care about is carried on.
Deferred Giving. Donors can set up funds through deferred-giving arrangements. A key feature of many estate plans is a tax advantage to you now for the commitment of a charitable gift later. The following can be used:
- Charitable remainder trusts allow you to receive income (or provide income for another person); when the trust terminates, the remaining assets will be used to support your charitable interests.
- Charitable lead trusts enable you to make significant charitable gifts in the near term while transferring substantial assets to beneficiaries, who may benefit from significantly lowered gift and estate taxes.
- Retirement plan assets can be used to support your charitable interests while achieving significant tax advantages for your heirs.
- Life insurance can be used as a charitable asset, enabling you to be eligible for a charitable tax deduction based on the current value of the paid-up policy.