Celebrate variety: 6 assets that make great gifts to charity

Posted on June 27, 2024

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When your client is getting ready to make a contribution to a fund at Stark Community Foundation or another charity, remind them not to automatically reach for the checkbook! Here are six different (and typically more tax-savvy) options to consider. 

1. Appreciated Stock

Stocks may be donated to Stark Community Foundation as a charitable gift. Your clients are eligible for a tax deduction for the stock's fair market value. By donating appreciated stock to Stark Community Foundation, your clients can avoid capital gains tax that would otherwise occur at the sale of the stock.

2. Real Estate and Personal Property

Residential property, commercial or industrial sites and undeveloped land are attractive assets for charitable giving. Your client can contribute a piece of real estate or a partial interest in a piece of real estate to Stark Community Foundation. Some donors choose to contribute property while retaining the right to live there during their lifetime. Special rules apply to donating personal property, so please discuss your clients' plans with Stark Community Foundation beforehand.

3. Retirement Accounts

Donors can use assets held in an individual retirement account (IRA), 401(k), 403(b) or similar account to start a fund at Stark Community Foundation now and at the time of their death. Many donors donate all or part of their retirement plan since these accounts are the most heavily taxed assets in an estate at the time of death. To make a gift using retirement assets, simply designate Stark Community Foundation as a partial or full beneficiary. There is no cost, and the beneficiary designation can be changed any time.

4. Life Insurance

Your clients can donate a life insurance policy to Stark Community Foundation or simply name us as the policy’s beneficiary. For a gift of a paid-up policy, donors will receive an income tax deduction equal to the lesser of the cash value of the policy or the total premiums paid. Donors must name the Foundation as owner and beneficiary to qualify for the federal charitable contribution deduction on a gift of an existing policy.

5. Charitable Remainder Trusts

Charitable Remainder Trusts guarantee a retirement income while making a significant charitable gift. Charitable Remainder Trusts allow your client to transfer assets to a trust, take an immediate tax deduction and receive an income stream for their lifetime. The deduction amount varies with the beneficiary's age.

6. Charitable Gift Annuities

Charitable Gift Annuities allow your clients to make a substantial gift to charity while retaining the right to a fixed and secure stream of income for life. In the case of Charitable Gift Annuities, that income is a fixed amount based on actuarial tables published by the American Council on Gift Annuities. A donor may defer receipt of the income for one or more years, increasing the ultimate payout. This strategy is known as a Deferred Gift Annuity. It is often used as a supplemental retirement plan for individuals who have already contributed the maximum amount to their qualified plan.

We look forward to collaborating with you to explore all the options! 


 *This blog post is provided for informational purposes only, and is not intended as legal, accounting or financial planning advice.

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