Types of Gifts
Current Gifts
Cash
This is the simplest and most convenient way of giving through the Community Foundation. Cash gifts qualify for maximum deductibility for federal income tax purposes–up to 50% of the adjusted gross income for the donor who itemizes.
Stocks and Publicly Traded Securities and Mutual Fund Shares
Stocks and publicly traded securities and mutual funds shares of appreciated securities provide double tax savings to the donor. You take an immediate charitable tax deduction for the current fair market value of the donated securities and no capital gains tax is paid on the contribution.
Closely Held Stock
Closely held stock can also be used to establish a fund at the foundation. If you own
a family business and are interested in using some of those assets for philanthropy, the foundation can partner with you to maximize your charitable involvement and minimize your tax liability.
Real Estate, Homes, Standing Timber, & other Property
Gifts of appreciated real property (homes, rental property, land, standing timber, etc.) offer unique tax advantages. If you are planning on selling real property, it could be especially convenient to donate a ¼, ½, etc. undivided interest in the real estate to your charitable fund. In this way any taxable gain realized on the sale of the real estate could be offset by the charitable donation. Because gifts of real estate require certain procedural steps, please call the Community Foundation in advance.
Life Insurance
Gifts of life insurance policies may be made by naming the Community Foundation
as the owner and beneficiary. The donor receives an immediate tax deduction approximately equal to the cash surrender value of the policy. Any premiums thereafter paid by the donor are deductible for income tax purposes. The proceeds after the death of the insured are not taxable as part of the donor\’s estate.
IRA / Retirement Plan Assets
If you have already created a sound estate plan that achieves all objectives and takes care of your family, using an IRA to make a current gift or a gift-by-will could avoid both income and estate taxes. A current gift of your IRA can be used to establish a Designated Fund to support a specific charity or charities of your choice. A gift of your IRA in your will can be used to establish a Donor Advised Fund which will allow your family to remain involved in the grant making process into perpetuity.
Planned Gifts
Bequests
Any type of Fund at the Community Foundation can be given a designated dollar amount through your will. A bequest will not be subject to estate or inheritance taxes.
Charitable Gift Annuities
The Charitable Gift Annuity (CGA) is a simple agreement between you and the Community Foundation: in exchange for a gift (usually cash or stock), the foundation pays the donor (and the donor’s spouse) a guaranteed life income. For example, if an 80 year old individual established a CGA for $25,000, they would receive an annual payout of $2,000 (8.0%) for life, get an immediate $12,000 charitable tax deduction, pay no capital gains if appreciated stock were used to fund the CGA, and leave a substantial memorial fund in their name to benefit the charities of their choice. We have the software to administer almost any type of planned gift.
Charitable Remainder Trusts
The Charitable Remainder Trust is a beneficial life income plan that financial advisors often recommend to their clients, including those who may not have previously considered charitable contributions as part of their estate planning. With a charitable remainder trust, you will gain an immediate income tax deduction, reduce estate taxes, generate more income from your investments, provide for a spouse, and possibly eliminate capital gain taxes. Your client receives all of these benefits while making a gift that will benefit in perpetuity the charity(s) of your choice.
Charitable Lead Trusts
It may be beneficial to you to establish a trust from which the income would be distributed to a fund at the Community Foundation for a set period of time, with the corpus reserved for a child or grandchild. Generally, such an arrangement provides an income tax deduction as the income is paid to the Community Foundation and reduces gift and estate taxes.
Life Estate/ Deed of Residence With Retention
You may deed your home (or other real estate) to a fund at the Community Foundation, retaining a life estate. You will be entitled to a current year charitable income tax deduction even though you will continue to live in your home for the rest of your life and the value of the house will be excluded from your taxable estate.
IRA / Retirement Plan Assets
If you have already created a sound estate plan that achieves all objectives and takes care of your family, using an IRA to make a current gift or a gift-by-will could avoid both income and estate taxes. A current gift of your IRA can be used to establish a Designated Fund to support a specific charity or charities of your choice. A gift of your IRA in your will can be used to establish a Donor Advised Fund which will allow your family to remain involved in the grant making process into perpetuity.