How to discuss charitable giving

Your clients may not be considering philanthropy when they come for an appointment with you, even if it’s to their advantage. And many professional advisors have told us they're reluctant to raise the issue.Your clients may not be considering philanthropy when they come for an appointment with you, even if it’s to their advantage. And many professional advisors have told us they're reluctant to raise the issue.

 

Times when charitable giving is worth bringing up with your clients:

  1. When they want or need an alternative to a private foundation

    Your client either doesn't have the substantial resources needed to start a private foundation or lacks the time to oversee its administration. The community foundation can help you and your client consider simpler, more cost-efficient alternatives to a private foundation, such as a donor advised fund .

  2. When they want to leave a legacy

    You're already aware including a charitable provision in your client's estate plan provides significant tax advantages, but it can also help them create a permanent legacy. Your client’s bequest  can create a fund that will contribute forever to causes that are important to them. The community foundation can help your client identify his or her charitable goals and help you maximize the tax benefits of the bequest.

  3. When you're working on year-end tax planning 

    Your client just earned a large bonus or his business created extraordinary profits. He wants to share that good fortune with the community but has little time at year’s end to decide how to maximize the impact of such good fortune. You can recommend a donor advised fund at the community foundation, which would allow your client to realize an immediate tax deduction, while giving him time to seek advice regarding the most effective use of his charitable assets. Actual grantmaking can be done at the client's convenience.

  4. When they have highly appreciated stock 

    If your client has highly appreciated stock and is willing to consider a charitable gift, he or she can receive a tax deduction for the full market value, while avoiding the capital gains tax that would otherwise arise from the sale of the stock. Closely held stock can also be used as gift property.

  5. When they want to retire comfortably 

    Your client may find he or she is not reaping sufficient income from their appreciated assets. A charitable gift annuity or charitable unitrust can help your client achieve their charitable objectives while preparing them well for retirement. 

  6. When they have substantial IRA/401(k) assets

    The community foundation can help you and your client evaluate the most beneficial asset distribution to minimize taxes, thereby giving more to his or her heirs and still achieving significant charitable objectives. For example, it is usually more tax advantageous for a donor to give retirement assets to charity and other assets to their heirs. Income tax and possibly estate taxes often dilute the value of an IRA or other retirement assets left to an heir.

  7. If they're selling their business

    Your client owns highly appreciated stock in a company that is about to be acquired. The community foundation can work with you to suggest several ways to structure a charitable gift (including the use of planned giving techniques) to help your client reduce capital gains tax and maximize the impact to his or her favorite charitable causes.