A planned gift is any major gift, made during the lifetime or at death as part of a donor's overall financial and/or estate planning. Planned giving enables donors who wish to make a gift to Carrollton larger than would otherwise be possible from their discretionary income. The gift can be made to the school in three ways:
■ An outright gift that is comprised of appreciated assets (i.e. stocks)
■ A gift planned to provide a life-long income to the donor (i.e. annuities)
■ A gift structured to use estate and tax planning techniques in ways that maximize the gift and/or minimize its impact on the donor's estate upon her or his passing.
Whether a donor uses cash, appreciated securities/stock, real estate, artwork, partnership interests, personal property, life insurance, or a retirement plan, the benefits of funding a planned gift can make this type of charitable giving beneficial to both donor and Carrollton.
What are the tax benefits of planned gifts?
■ Donors can contribute appreciated property, like securities or real estate, receive a charitable deduction for the full market value of the asset, and pay no capital gains tax on the transfer.
■ Donors who establish a life-income gift receive a tax deduction for the full, fair market value of the assets contributed, minus the present value of the income interest retained; if they fund their gift with appreciated property they pay no upfront capital gains tax on the transfer.
■ Gifts payable to charity upon the donor's death, like a bequest or a beneficiary designation in a life insurance policy or retirement account, do not generate a lifetime income tax deduction for the donor, but they are exempt from estate tax.