Charitable Gift Planning

Planned giving (or "charitable gift planning") refers to the process of making a charitable gift of estate assets to one or more nonprofit organizations, a gift that requires consideration and planning in light of the donor's overall estate plan.

Such gifts usually include legal documents and often require the assistance of a qualified professional advisor to complete. Because of the size and potential impact of such gifts, a donor should consult with his or her professional advisors before completing the process.

Planned gifts are usually deferred, meaning they are arranged now and fulfilled later. For example, a person could include a provision in his or her will to make a bequest to a charitable organization. That arrangement would be a "planned" gift.

Or, a person might establish a charitable trust that could provide income to the donor (or someone else) for a period of time (usually for life). After this gift-deferral period, the trust would "mature" and the remaining assets (corpus) would go to one or more charities. This is called a charitable remainder trust.

Another kind of planning device allows a donor to place assets in a trust that pays out income to charity for a period of years. Then, when this trust "matures," whatever is left goes back to the donor or to someone else stipulated by the donor. This is called a charitable lead trust.



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