What is Gift Planning?
Gift planning is charitable giving coordinated with your charitable, financial, tax and estate goals. Good planning with tax-wise gifting strategies enables you to make significant charitable gifts during life and after you pass away.
Such gifts often require deliberation, planning and counsel. These gifts may be current or deferred through a person's estate. They often involve the gifting of assets (versus outright cash gifts) such as appreciated securities, real estate, business interests, retirement plans, life insurance, collectibles and so forth. The strategies can also involve blended giving, which means outright gifts combined with future gifts to make a person's giving go further.
There are many advantages for people who employ gift planning in their estate planning. First, gift planning enables donors to make larger gifts than they ever thought possible for a greater impact in the current work of their favorite nonprofit(s) and/or in the future through their estate. Besides making a significant gift, the donor is entitled to a charitable income deduction, estate tax savings and the ability to avoid capital gains taxes. Some gift plans provide the donor with a lifetime stream of income. Others provide income to the nonprofit and principal to the donor's heirs.
There are several types of gift plans:
- Outright asset gifts
- Qualified charitable distributions (QCDs)
- Bequests via will or trust
- Beneficiary designations
- Charitable life income plans
- Charitable lead trusts
- Donor advised funds (DAFs)
- Charitable life estates
- Zero-tax gift and sales
These planned gifts can also be combined. For more details, visit our How to Give page.
Which gift plans are appropriate for you greatly depends on your personal situation and planning goals for you and your family.
A wise man once said the "art of gift planning" involves connecting the head, the heart and the wallet of the donor:
- The head - Understanding why a nonprofit needs and is worthy of my support, and how my support will impact it
- The heart - My wealth follows my passions
- The wallet - Does this gift make sense for me and my family given my personal situation and goals?
Contact us today to learn more about gift planning. We would welcome the opportunity to serve you.
