What kinds of gifting by individual donors are most common?
Summary:
A classification of various kinds of gifts.
Answer:
And how are they structured?
Gifts to charitable organizations are made during a lifetime, or at
death, and in either case are made outright to the nonprofit, or are
subject to a non-charitable beneficial interest in addition to the
charitable gift. The income tax, capital gain tax, gift tax, and federal
estate (death) tax consequences will depend upon the subject matter of
the gift as well as the nature of the donee, and also upon the structure
of the gift.
During a lifetime, the most common forms of gift are:
a.) Outright, such as delivering a check, a work of art, or transferring
title to real estate or securities with no interest retained by the
donor or another person.
b.) By transfer to a Pooled Income Fund or similar arrangement
maintained by the nonprofit organization. In this case the donor retains
an income interest for life or for a set period of time, following which
the nonprofit receives the balance.
c.) By the establishment of a Charitable Remainder Annuity Trust or a
Charitable Remainder Unitrust whereby the donor or others retain an
income interest for life or for a set period of time, following which
the nonprofit receives the balance. These trusts are irrevocable. This
type of arrangement is usually established through a trust company or
bank trust department.
d.) By the establishment of a Charitable Lead Annuity Trust or
Charitable Lead Unitrust, whereby the nonprofit first receives an income
interest for a period of time, following which the balance is
distributed to non-charitable beneficiaries, such as the donor's
children. These trusts are irrevocable. This type of arrangement is also
usually established through a trust company or bank trust department.
At death, the most common forms of gift are:
a.) Outright gifts of cash or transfer of other property, under
decedent's will or trust.
b.) By the establishment of a Charitable Remainder Annuity Trust or
Charitable Remainder Unitrust under decedent's will, whereby an
individual or individuals are given an income interest for life or for a
set period of time, following which the nonprofit receives the balance.
These trusts are irrevocable. This type of arrangement is generally
established through a trust company or bank trust department.
