The three stages are 1. the drafting of the trust instrument 2. the funding of the trust and 3. the administration of the trust The drafting stage: IRS has provided specimen agreements for annuity trusts and unitrusts, which makes the drafting of CRAT and CRUT documents relatively easy. But there are some cautions here. Some …Read More
Gift planning has focused traditionally on squeezing maximum tax benefits out of a gift arrangement. There are, however, some good gift arrangements for which little or no tax benefits are available. “Good” here means good for the donee organization. Let’s consider some specific examples. Donor contributes a valuable painting she painted: Donor’s income tax charitable …Read More
WHY DOESN’T THE DONOR REALIZE GAIN WHEN GIVING AN APPRECIATED ASSET SUCH AS APPRECIATED STOCK? Gain is realized only on the sale or exchange of an appreciated asset. Note that a gift annuity funded with appreciated stock involves a sale or exchange (it’s a kind of bargain sale). Note too that a gift of mortgaged …Read More
These regs are important. They deal with gift receipts and qualified appraisals, documents on which IRS auditors focus. The new regs take effect January 1, 2019. Without a correct gift receipt, Donor will have his or her entire federal income tax charitable deduction disallowed on audit. Same result as to an appraisal that doesn’t meet …Read More
Life estate gifts involve the gift of a personal residence or farm subject to a retained life estate. The retained interest also can be an estate for a term of years. “Estate” means the exclusive right to occupy or the right to rents (e.g., in the case of a farm leased to a tenant). “Personal …Read More
When working on an estate where you are the primary beneficiary, it can be worth checking www.missingmoney.com for lost assets. This is a joint website set up by 42 (so far) state unclaimed property agencies to help find missing assets. Just plug in your or your organization’s name and see what pops up. It also offers …Read More
Everyone who has worked on lots of planned gifts from Baby Boomers, hold up your hands. Just as I thought. Sure, there are gift plans that fit. Lead trusts in some cases. Term-of-years CRTs. Deferred payment gift annuities. Virtual endowments. The writer hasn’t seen more than a few window shoppers and at most only a …Read More
Older individuals who have inherited wealth are often mistrusting of others, and usually for good reason. There are lots of people who would like to get their hands on the wealth. Such an individual typically has a few close advisers or confidantes she trusts, and that’s it. The problem often is, the wealthy individual trusts …Read More
A major area of planned gift fundraising is working with elderly individuals. Here some problems to anticipate: The donor repeatedly over time asks the same question or asks for information you’ve already provided. It’s probably best to provide this individual with a postage-paid envelope addressed to you and ask that he or she communicate with …Read More
Good charitable gift planning often requires an understanding of applicable state law. Pledges: The enforceability of a pledge depends on the law of the state whose laws govern the pledge. For example, Donor lives in New Jersey and makes a spoken (non-written) promise to give $X to a charity located in Kentucky. If New Jersey …Read More