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Possible Funding Assets

Related Use

Related use refers to whether a charity will put a gift of tangible personal property, such as artwork or an antique car, to a use that is related to the organization's charitable purpose.

Gifts Funded with Multiple Assets

While most planned gifts are funded with a single asset, typically cash or a single block of long term appreciated securities, it is not unusual for a donor to create a planned gift using a combination of assets. The combination might be a single block of long term appreciated securities plus cash, or a block of long term appreciated securities plus a block of short term appreciated securities, or cash plus long term appreciated mutual fund shares and short term appreciated mutual fund shares.

Turning Real Estate Into a Possible Source of Income

Given the choice, most charities and asset managers would prefer that donors fund life income gifts with cash or publicly traded securities. These assets are easy to value and easy to sell. Real estate, on the other hand, can be difficult to value and hard to sell. It also carries with it financial risk due to environmental problems, hidden structural defects, and a host of other possible issues.

Retained Life Estate + Deferred Gift Annuity

A retained life estate plus deferred gift annuity combines two gift arrangements. The arrangements allow a donor to use some of the value of her home or farm to fund a plan that will make payments to her or others for life starting one or more years after the gift is made.

Exchange of a Charitable Remainder Unitrust’s Income Interest for a Charitable Gift Annuity

Income beneficiaries may be interested in receiving an annuity amount rather than income from a unitrust. There are a number of reasons a beneficiary might consider such an arrangement. The downturn in the economy may be reducing the payout the beneficiary is receiving. A change in the beneficiary’s financial situation may prompt them to look for a more secure income stream. By releasing the beneficiary’s interest in the CRUT, the charity receives the trust principal sooner.

Short Term Appreciated Property

Short term appreciated property is appreciated property that has been held by the owner for 12 months or less. When a taxpayer sells short term appreciated property, the gain realized in the sale is subject to ordinary income tax.

Series EE Bond

A Series EE bond is a form of U.S. Savings Bond that was introduced in 1980.

Long Term Appreciated Property

Long term appreciated property is appreciated property that has been held by the owner for more than 12 months. When a taxpayer sells long term appreciated property, the gain realized in the sale is subject to capital gains tax.

Tangible Personal Property

Tangible personal property is a physical object or objects, such as a car, a chair, or a coin collection.

Series HH Bond

A Series HH bond is a form of U.S. Savings Bond that was introduced in 1980. Series HH bonds bear interest that is exempt from state and local taxes.

The owner of a maturing Series EE bond can exchange it for a Series HH bond in lieu of paying federal income tax on part of the Series EE bond proceeds. This is the only way to acquire Series HH bonds.

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