Planned giving is the process of donating planned gifts, also known as legacy gifts, which are contributions that are arranged in the present and allocated at a future date. Commonly donated through a will or trust, planned gifts are usually granted when a donor passes away. If you’d like to plan a gift for to support the important work of HHRA, you may use this form. Thank you.
Tax benefits: Donors can contribute appreciated property, like securities or real estate, receive a charitable deduction for the full market value of the asset, and pay no capital gains tax on the transfer. Donors who establish a life-income gift receive a tax deduction for the full, fair market value of the assets contributed, minus the present value of the income interest retained; if they fund their gift with appreciated property they pay no upfront capital gains tax on the transfer. Gifts payable to the HHRA upon the donor’s death, like a bequest or a beneficiary designation in a life insurance policy or retirement account, do not generate a lifetime income tax deduction for the donor, but they are exempt from estate tax.
More information: For those who wish to make legacy gifts that are guaranteed to support their own philanthropic interests and intentions, planned or deferred gifts may be most effective. Planned gifts require more planning than most current gifts or income or equity, often including legal and accounting counsel from a donor’s trusted advisors. Because these gifts produce philanthropic benefits to recipient organizations, there may be benefits to the donors or their heirs via reductions in state or federal income, capital gains, estate, or gift taxes.
There are many ways to make planned gifts, the most simple of which are life insurance policies, designated distributions from retirement funds, or bequests, where donors designate a percentage or a specific amount of their estate to the recipient charity. Specific amounts are preferable, as they do not require a full valuation of the estate before distribution can be made. For donors over the age of 70 ½ years who are required to take minimum annual distributions from their Traditional or Roth Individual Retirement Accounts (IRAs), up to $100,000 may be directed to charitable causes, with potentially significant tax savings each year.
More complex planned giving arrangements such as charitable gift annuities, charitable remainder unitrusts, charitable remainder annuity trusts, lead trusts and others may provide donors with guaranteed income for the remainder of their lives in exchange for funds transferred to charities now. The gist of most such gift vehicles involves a donor making a current gift to a charity with commensurate tax benefits, the charity paying the donor per agreed-upon terms from those funds in the years that follow, with the remainder of the funds at the donor’s death remaining with the charity in perpetuity.