What is Planned Giving? So often we hear these terms tossed around by financial advisors and estate planners without really understanding the various and innovative opportunities available.
When The Dental Foundation of Oregon talks about planned giving, we mean gifts to a charitable entity. A planned gift to a charity is one that is legally provided during the donor’s lifetime, but whose principal benefits may not go to the charity until a future time. Generally this occurs at the death of the donor. But some planned gifts involve a lifetime income flow for the donor and spouse; the charity receives the benefits after both the donor and spouse have passed on.
Why should you consider a planned gift? First of all, it is a way to make a larger gift to your favorite charity than most people can give out of their pockets. It can provide income for the donor or a beneficiary. It offers a way to have assets managed at low or no cost. It can provide substantial income, estate and capital gains tax savings. It obviously encourages estate planning, and offers an opportunity for the creation of a permanent memorial with your favorite charity.
Planned gifts can take many forms. The simplest is provision in a will or life insurance policy. Other options are more complex, but offer more incentives to the donor. Appreciated assets in stocks, real estate or a business can be donated and some major tax advantages can be realized. Examples of these options would be a Charitable Gift Annuity or a Charitable Remainder Unitrust. There is also a Charitable Remainder Annuity Trust option.
Planned giving can provide a donor with an income stream — some of which is tax free — as well as an income tax deduction, a capital gains tax reduction and a diminished estate tax. It’s a way to have your cake and eat it, too — while sharing your serving with your favorite charity.
Please consider the following ways to give:
Prepare a Will or Trust
Only 50 percent of those who pass away have one. Without a will, you may lose control over your belongings and assets.
Review Your Will or Trust
Update it as needed every three to five years or when changes occur in your family, marital or financial status.
Leave a Bequest in Your Will or Trust
Designate a gift for the nonprofit and charitable organizations that made a difference in your life. Imagine the positive impact on our community if everyone made a donation to a favorite nonprofit. Less than six percent of American households have included nonprofits in an estate plan. View suggested DFO Bequest Language.
Designate the Size of Your Bequest
Leave a specific dollar amount or a percentage of the assets in your estate to the nonprofit(s) of your choice.
Consider Using Assets for Your Charitable Gift
These include but aren’t limited to: cash, stocks, bonds, CD’s, real estate, vehicles, art and jewelry.
Leave a Pension or IRA Account to a Charity
Name a nonprofit of your choice as the beneficiary of your pension plan or IRA.
Leave a Life Insurance Policy to a Charity
Name your favorite nonprofit as the beneficiary of an existing life insurance policy.
Remember Loved Ones with Memorial Gifts to Nonprofits
A thoughtful and meaningful expression of sympathy is a memorial gift to a charity in the name of a family member or honored colleague.
Set a Good Example
Encourage family and friends to leave bequests to nonprofits in their wills or trusts. Help others share the satisfying feeling of “giving a gift that gives back.”
