What is an IRA? Part III

Posted June 24th, 2019

Let’s now look at the situation in which Donor names Charity as beneficiary of her IRA. This is a common situation. Common in large part because charities have promoted heavily the idea of leaving IRA assets to a charitable organization. When Donor dies, her IRA becomes an inherited IRA, and Charity becomes beneficiary of the …Read More

What is an IRA? Part II

Posted June 13th, 2019

Last time, we looked at how the term IRA is defined; who can establish a brand new IRA; and the definition of the term “inherited IRA”. Now we dig deeper into the concept of an inherited IRA. We’ll do this using a real-life example of an individual beneficiary. Later we’ll look at a real-life example …Read More

What is an IRA?

Posted May 30th, 2019

It’s good to know what an IRA is, given that so much money comes to charities from IRAs. An IRA is defined in the Tax Code as: a trust established in the U.S. for the benefit of an individual or his/her beneficiaries that meets certain requirements (e.g., is prohibited from investing in life insurance). That’s …Read More

A CRT Paying Into a Second Trust — Part II

Posted May 17th, 2019

Last time, we looked at the idea of a CRT paying into a second trust. We focused on an example of a charitably motivated parent who wants to provide support for his 49-year-old disabled son. The plan we examined was a 20-year term-certain CRT paying into a second trust that was to provide for the …Read More

A CRT Paying Into a Second Trust

Posted April 25th, 2019

Sometimes in charitable gift planning it’s necessary to design a gift plan to meet complex donor objectives. For example: Donor wants to benefit CHARITY A and also provide an income for his son. The problem is that the son is only 49 years old and is severely disabled with a birth defect. If Donor is …Read More

A Real Estate Matter

Posted April 9th, 2019

Lots of individuals have used real estate to make charitable gifts. The question for today is, when is the gift deemed made? To keep things simple, let’s assume: the real estate is environmentally clean undeveloped land; the donor holds legal title to the land (i.e., the land isn’t held in a corporation, LLC, or other …Read More

What to Do When the Donor Dies

Posted April 2nd, 2019

Planned giving officers must at some point deal with death and the emotional, legal and financial issues that arise when a donor passes away. The March/April 2019 issue of Give & Take features a panel discussion with me and my colleagues, Laura Knitt and John Jensen, on some of the most commonly asked questions we …Read More

Let’s Look at a Proposed CRAT Amendment — Letter Ruling 200010035

Posted March 25th, 2019

Facts Some time ago, H and W established a CRAT of which they are the trustees. The remainder beneficiary of the CRAT is H and W’s private foundation. The assets of the CRAT have grown to the point where they’re way more than needed to support the annuity payments to H and W. What H …Read More

Tax Rules in Charitable Gift Planning

Posted March 8th, 2019

Donor wants to establish a gift annuity with appreciated stock but doesn’t know her cost basis in the stock. – The rule here is simple. If a taxpayer doesn’t know the basis of an asset he or she owns, the basis is zero for federal tax purposes. Donor wants to contribute a life insurance policy …Read More

Charitable Gift Planning Q&A

Posted February 20th, 2019

1.  Must the books kept by the development office and by the business office be identical? No, and they shouldn’t be. Business office accounting is governed by FASB. FASB has nothing to do with development office counting, crediting, and recognition. 2.  Is it OK to provide in a naming-gift pledge agreement that the pledge is …Read More