THE TOOLS AND TECHNIQUES OF CHARITABLE PLANNING
1st Edition
Outline
CHAPTER 1: SELLING THE DREAM
A. The Growth of Charity
B. Selling the Dream of “Better”
C. Who is Selling the Dream?
D. Selling the Dream Requires an In-depth Understanding of Why People Give
E. Why People Don't Give More?
F. Where Can I Find Out More About It?
CHAPTER 2: GENERAL RULES FOR CHARITABLE DEDUCTIONS
A. Overview
B. What Is It?
1. Qualified Charities Defined
2. Direct Gifts
a. Cash Gifts
b. Ordinary Income Property
c. Long-term Capital Gain Property
d. Life Insurance
e. Annuities
f. Series E and EE Bonds
g. Gifts of Tangible Personal Property
3. Nondeductible Gifts or Contributions
C. Value and Substantiation of Gifts
1. Fair Market Value
2. Substantiation
a. Gifts of Less than $250
b. Gifts of $250 or More
c. Gifts of More than $500
d. Gifts of More than $5,000
e. Gifts of Artwork More than $20,000
f. Gifts of Artwork Valued at More than $50,000
3. Loss of Deduction
D. What Are the Tax Implications?
1. Income Tax
2. Gift Tax
3. Estate Tax
E. Penalty for Overvaluation
1. 20% Negligence Penalty
2. Valuation Misstatement Penalties
a. 20% Substantial Valuation Misstatement Penalty
b. 40% Gross Valuation Misstatement Penalty
3. 75% Fraud Penalty
4. $1,000 Civil Penalty
F. Timing of Deduction
CHAPTER 3: INCOME PERCENTAGE LIMITATIONS
A. What Is It?
1. Public (50%) Charities
B. How Is It Done?
1. Public (50%) Charities
2. Private Family Foundations (30% Charities)
3. Order of Charitable Deductions Allowed
4. Reduction from Fair Market Value to Cost Basis
5. Fair Market Value Less Than Cost Basis
6. Property Subject to a Debt
7. Gifts Made by a Corporation
C. “To” Versus “For the Use Of”
D. Carryover Rules
1. Effect of Subsequent Events on Carryover Provisions
2. Information to Support a Carryover Deduction
CHAPTER 4: GIFTS OF PROPERTY
A. What Is It?
B. When is the Use of Such a Device Indicated?
C. Tangible Personal Property
1. Related Use
2. Investment or Inventory?
3. Future Interest
4. Unusual Asset Types
D. Intangible Property
E. Publicly Traded Securities
F. Privately Held Businesses
1. Sole Proprietorships
2. Partnerships
3. C Corporations
4. S Corporations
5. Limited Liability Companies (LLCs)
G. Real Property
1. Fee Simple
2. Partial Interests
3. Indirect Ownership
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 5: PARTIAL INTEREST RULES
A. What Is It?
B. When is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
1. Undivided Portion of Donor's Entire Interest
2. Remainder Interest in Personal Residence
3. Remainder Interest in Farm
4. Other Partial Interest Gifts
5. Right to Use Property
F. How it is Done?
1. Valuation of a Deduction for an Undivided Interest in Property
2. Valuation of a Deduction for a Contribution of a Remainder Interest in a Personal Residence
G. What Are the Tax Implications?
H. What Are the Alternatives?
I. Where Can I Find Out More About It?
J. Questions and Answers
CHAPTER 6: E-PHILANTHROPY AND TECHNOLOGY ISSUES
A. What is E-Philanthropy?
B. Advantages
C. Disadvantages
D. Where Can I Find Out More About It?
CHAPTER 7: ETHICAL ISSUES IN CHARITABLE PLANNING
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. How Is It Done?
1. Donors
2. Charity Board Members & Executives
3. Planned Giving & Development Officers
4. Advisors
D. Where Can I Find Out More About It?
E. Questions and Answers
CHAPTER 8: THE PLANNED GIVING OFFICE
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. What Are the Requirements?
D. How Is It Done? An Example
1. What Is a Public Charity?
2. Other Requirements for Tax-Exempt Status
3. The Charity's Mission Statement
4. Balancing the Needs of the Charity With Those of the Donor
5. Major Gift Acceptance Policy
6. Donor Contact
7. Compensation
8. Public Disclosure & Accountability
9. State Laws
10. Marketing to Donors
11. Networking With Advisors and Peers
12. The Professional Advisory Board
13. Continuing Education
14. Gift Counting & Accounting
15. Capital Campaign
16. Quotas & Other Job Pressures
E. Where Can I Find Out More About It?
F. Questions and Answers
CHAPTER 9: THE PLANNED GIVING TEAM
A. What Is It?
B. When is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
1. Planned Giving Officers
a. Truths and Misconceptions Regarding Planned Giving Officers
b. The Ideal Planned Giving Officer as a Member of the Planning Team
2. Financial Advisors
a. Some Truths and Misconceptions Regarding Financial Advisors
b. The Ideal Financial Advisor as a Member of the Planning Team
3. Tax Advisors or Estate Planning Attorneys
a. Some Truths and Misconceptions Regarding Tax Advisors and Estate Planning Attorneys
b. The Ideal Tax Advisor or Estate Planning Attorney as a Member of the Planning Team
4. Technical Competence
F. How Is It Done?
G. Where Can I Find Out More About It?
H. Questions and Answers
CHAPTER 10: BARGAIN SALE TRANSACTIONS
A. What Is It?
B. When is the Use of Such a Device Indicated?
C. Advantages
1. Advantages to the Donor
2. Advantages to the Charitable Organization
D. Disadvantages
1. Disadvantages to the Donor
2. Disadvantages to the Charitable Organization
E. What Are the Requirements?
F. How Is It Done?
G. What Are the Tax Implications?
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 11: BELOW-MARKET INTEREST LOANS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How It is Done?
1. Gift Loans
2. Compensation-Related Loans
3. Corporation-Shareholder Loans
4. Tax Avoidance Loans
5. Significant Tax Effect Loans
6. Loans to Qualified Continuing Care Facilities
7. Exceptions to the Below-Market Loan Rules
G. What Are the Tax Implications?
H. What Are the Alternatives?
I. Where Can I Find Out More About It?
J. Questions and Answers
CHAPTER 12: CHARITABLE GIFT ANNUITIES
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. How Is It Done?
F. What Are the Tax Implications?
1. Income Tax Treatment to the Donor and Annuitant
2. Gift Tax Issues
3. Estate Tax Issues
G. Where Can I Find Out More About It?
H. Questions and Answers
CHAPTER 13: CHARITABLE GIVING USING LIFE INSURANCE
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Outright Gifts at Death
1. Life Insurance Policies
2. Annuity Contracts
D. Outright Gifts During Life
1. Life Insurance Policies
2. Annuity Contracts
E. New Life Insurance Purchases
1. Insuring Against the Loss of a Major Donor
2. Gifts of Premiums Earmarked for New Insurance
a. State Insurable Interest Rules
3. State Laws Governing the Contract
a. Risk Assessment and Insurance Illustrations
b. A Gift With Strings Attached
c. Duty to Invest Prudently
d. Percentage-Based Fund Raising Fees
e. Future Premiums
f. How to Proceed
F. Life Insurance as a Wealth Replacement Tool
1. Transfers into Split Interest Vehicles
2. Charitable Remainder Trust
3. Charitable Gift Annuity
G. Insurance as an Investment
1. Individual Insurance
2. Group Policies
3. Viatical Settlements
4. Annuities
5. Reinsuring Charitable Gift Annuities
6. Charitable Remainder Trust
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 14: CHARITABLE LEAD TRUSTS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How Is It Done -- Examples
G. What Are the Tax Implications?
1. Valuing the Charitable Deduction
2. Grantor Lead Trust
3. Family Lead Trust
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 15: CHARITABLE REMAINDER ANNUITY TRUSTS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How Is It Done?
G. What Are the Tax Implications?
1. Income Tax
2. Gift Tax
3. Estate Tax
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 16: CHARITABLE REMAINDER UNITRUSTS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
1. Basic Requirements
2. Net Income Exception CRUT (NICRUT)
3. Net Income with Make-Up Provision CRUT (NIMCRUT)
4. “FLIP” Unitrust
F. How Is It Done?
1. Joint Life CRUT with Wealth Replacement Trust
G. What Are the Tax Implications?
1. Value of the Charitable Deduction
2. Taxation of CRUT Income and Payouts
3. Determination of Trust Income
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 17: COMMUNITY FOUNDATIONS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How Is It Done?
G. What Are the Tax Implications?
H. What Are the Alternatives?
I. Where Can I Find Out More About It?
J. Questions and Answers
CHAPTER 18: QUALIFIED CONSERVATION CONTRIBUTIONS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. What Are the Requirements?
1. Qualified Conservation Contribution Requirements
a. Qualified Real Property Interest
2. Qualified Organization
3. Exclusively for Conservation Purposes
4. Estate Tax Exclusion Requirements
D. How Is It Done?
E. What Are the Tax Implications?
1. Income Tax
2. Estate Tax
a. Estate Tax Exclusion for Land Subject to Permanent Conservation Easement
F. Where Can I Find Out More About It?
G. Questions and Answers
CHAPTER 19: DONOR ADVISED FUNDS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. Types of Donor Funds
G. How Is It Done? Examples
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 20: Pooled Income Funds
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How Is It Done?
1. Irrevocable Gift
2. Property Suitable to Donate
3. What Can the Pooled Income Fund Do With the Assets?
4. Units of Participation
a. Summary of Benefits to the Donor
5. Wealth Replacement Technique
G. What Are the Tax Implications?
1. Income Tax
2. Gift Tax
3. Estate Tax
4. Taxation of the Pooled Income Fund
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 21: PRIVATE FOUNDATIONS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
1. Private Foundation Excise Taxes
F. How Is It Done?
1. Private Operating Foundations
G. What Are the Tax Implications?
H. What Are the Alternatives?
I. Where Can I Find Out More About It?
J. Questions and Answers
CHAPTER 22: RETIREMENT PLAN GIFTS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How Is It Done? an example
1. Testamentary Gift Directly to Charity
2. Testamentary Gift Using a Charitable Remainder Trust
a. Distributions as IRD
3. Wealth Replacement
G. What Are the Tax Implications?
1. Income Tax
a. Distributions of Employer Securities
b. Income in Respect of a Decedent
2. Required Minimum Distributions
a. Planning Opportunities
3. Estate Tax
H. Where Can I Find Out More About It?
I. Questions and Answers
CHAPTER 23: TESTAMENTARY GIFTS
A. What Is It?
1. Pecuniary Amount
2. Percentage/Fractional Bequests
3. Specific/General Bequests
4. Contingent Bequests
B. Testamentary Split Interest Gifts
1. Charitable Remainder Trusts
2. Charitable Lead Trusts
3. Pooled Income Funds
4. Remainder Interest in a Farm or Personal Residence
C. When is the Use of Such a Device Indicated?
D. Advantages
E. Disadvantages
F. What Are the Requirements?
1. Cy Pres Doctrine
G. Which Charities Qualify for an Estate Tax Charitable Deduction?
H. How Is It Done?
I. Issues with Specific Property
1. Tangible Personal Property
2. Income in Respect of a Decedent
3. Testamentary Gifts of Life Insurance
4. Commercial Annuities
J. What Are the Tax Implications?
1. Charitable Estate Tax Deduction
2. Property Included in Decedent's Gross Estate
3. Payment of Estate Taxes
4. QTIP Property
5. Powers of Appointment
a. General Power of Appointment
b. Special Power of Appointment
6. Disclaimers
7. Income Earned During Estate Administration
K. Questions and Answers
CHAPTER 24: SUPPORTING ORGANIZATIONS
A. What Is It?
B. When Is the Use of Such a Device Indicated?
C. Advantages
D. Disadvantages
E. What Are the Requirements?
F. How Is It Done?
G. What Are the Tax Implications?
H. What Are the Alternatives?
I. Where Can I Find Out More About It?
J. Questions and Answers