Planned giving - AbsoluteAstronomy.com

Planned giving is an area of fundraising

Fundraising

Fundraising or fund raising is the process of soliciting and gathering voluntary contributions as money or other resources, by requesting donations from individuals, businesses, charitable foundations, or governmental agencies...

that refers to several specific gift types that can be funded with cash, equity, or property. These gift vehicles are commonly based on United States

United States

The United States of America is a federal constitutional republic comprising fifty states and a federal district...

tax law

Tax law

Tax law is the codified system of laws that describes government levies on economic transactions, commonly called taxes.-Major issues:Primary taxation issues facing the governments world over include;* taxes on income and wealth...

, but Canada

Canada

Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...

, the United Kingdom

United Kingdom

The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

, and other nations are beginning to establish similar laws. In the United States, the specific rules of planned giving are defined by the United States Congress

United States Congress

The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....

and the Internal Revenue Service

Internal Revenue Service

The Internal Revenue Service is the revenue service of the United States federal government. The agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue...

.

The term, "planned giving," was coined almost 40 years ago by Robert F. Sharpe:

"A donor usually considers a current gift to your institution as a cash outlay now. To make a deferred gift, a person decides to give at some future date, either a number of years from now or at death. A deferred gift is a present decision to make a future gift, evidenced by a legal contract.

"While the name 'deferred giving' is best known to professionals in the field, it is not a term that communicates very much to the average donor. Therefore, we suggest the term 'planned giving.' When a person makes a planned gift, it suggests forethought."

—Give & Take, a publication of the Sharpe Group, August 1972

Planned gifts are referred to as such because they require more planning, negotiation and counsel than many other gifts. Planned gifts can result in immediate income, income to charity over time or serve to delay a gift for life or other period of time while the donor or others retain income and/or access to the assets used to fund the gift. Because of the current or future charitable benefits, a number of state and/or federal income tax, capital gains, estate and gift benefits are associated with giving in this way.

Efforts to encourage planned gifts are popular among thousands of colleges, universities, hospitals, museums and community foundations in the United States. Funds generated through planned gifts are devoted to current funding needs as well as capital projects and endowments.

Reports published during and after the Great Depression of the 1930s indicate that planned gifts provided a higher percentage of philanthropic dollars than in times of economic prosperity. More about philanthropic gifts in uncertain times.

Types of planned gifts

By far, the most commonly utilized planned gift is the bequest

Bequest

A bequest is the act of giving property by will. Strictly, "bequest" is used of personal property, and "devise" of real property. In legal terminology, "bequeath" is a verb form meaning "to make a bequest."...

of property through a person's final will. Other types include:

Charitable bargain sale
Charitable Gift Annuity (CGA)
Charitable Gift Annuity (CGA)
A Charitable Gift Annuity is a gift vehicle that falls in the category of Planned Giving. It involves a contract between a donor and a charity, whereby the donor transfers cash or property to the charity in exchange for a partial tax deduction and a lifetime stream of annual income from the charity...
Charitable Remainder Annuity Trust (CRAT)
Charitable Remainder Annuity Trust (CRAT)
A Charitable Remainder Annuity Trust, is a Planned Giving vehicle that entails a donor placing a major gift of cash or property into a trust. The trust then pays a fixed amount of income each year to the donor or the donor's specified beneficiary. When the donor dies, the remainder of the trust is...
Charitable Remainder Unitrust (CRUT)
Charitable remainder trust
Charitable lead annuity trust
Charitable lead trust
Donor Managed Investment Account
Donor Managed Investment Account
A Donor Managed Investment Account is a charitable giving mechanism that provides donors with a full tax deduction at the time the account is funded, while permitting them to exercise ongoing investment management over the account funds for a period of time.By offering a high level of investment...
Pooled income fund
Retained life estate
Testamentary life income

Assets to give

Securities
Security (finance)
A security is generally a fungible, negotiable financial instrument representing financial value. Securities are broadly categorized into:* debt securities ,* equity securities, e.g., common stocks; and,...
Business Interests
Company
A company is a form of business organization. It is an association or collection of individual real persons and/or other companies, who each provide some form of capital. This group has a common purpose or focus and an aim of gaining profits. This collection, group or association of persons can be...
Cash
Cash
In common language cash refers to money in the physical form of currency, such as banknotes and coins.In bookkeeping and finance, cash refers to current assets comprising currency or currency equivalents that can be accessed immediately or near-immediately...
Life insurance
Life insurance
Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger...
Personal property
Personal property
Personal property, roughly speaking, is private property that is moveable, as opposed to real property or real estate. In the common law systems personal property may also be called chattels or personalty. In the civil law systems personal property is often called movable property or movables - any...
Real estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
Retirement plan

External links

Consultants

Sharpe Group

Organizations

Vendors

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