Log in

Getting the most out of ‘my gift’

How can your church/charity and you both benefit from your gift?

Sims Jr.

How can your church/charity and you both benefit from your gift?

You could receive an immediate income tax deduction. With a properly structured gift, you could realign your investment portfolio without paying capital gains tax on appreciated property. Another strategy may allow you to pass your estate on to your children while avoiding both probate and estate taxes.

You’re free to give your property to whomever you choose. To retain the tax advantages associated with planned giving, however, your gift must be made to a qualified organization.

The vast majority of donations are made to charitable organizations. To qualify, a charitable organization must have been organized in the United States, be operated on a strictly non-profit basis, and not be politically active.

In addition to common charitable organizations, you may give to veterans’ posts, certain fraternal orders, volunteer fire departments, and civil defense organizations.

You can contribute almost anything to a qualified organization. The deduction limits are more restrictive for gifts other than cash, but you are free to give almost any property of value.

Gifting strategies?

In addition to making an outright donation, there are a number of different gifting techniques you can use.

You can give life insurance. This enables you to give a large future gift at a relatively modest cost.

A charitable remainder trust allows you, or your beneficiaries, to receive payment of a specified amount annually, and at the end of the trust period, the designated charity the remainder assets. With a charitable lead trust, you can give the income to the charitable organization and at the end of the trust period, the remaining assets are paid to you or your beneficiaries.

(Charles Sims Jr., CFP®, is President/ CEO of The Sims Financial Group. Contact him at 901-682-2410 or visit www.SimsFinancialGroup.com. The information in this article is not intended to be tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties.)


Add comment

Security code