Specific Philanthropic Tools for Life, Death and Perpetuity

Depending on when donors envision giving, there are several types of donations to consider as part of the traditional financial and estate plan:

Direct transfers:

Gold Bars ImageDirect transfers are gifts given during a donor’s lifetime and consist of checks, cash, gold, etc. Donors give directly to the organization/institution and work directly with fundraisers at the institution. Direct transfers involve fewer legal issues and tax problems or knowledge regarding tax codes. ( Source: Ann Kaplan. 2010.”Philantropic Planning” Smith College, October 20, presentation)

CRUT (Charitable Remainder UniTrusts)

CRUT are donations which combine lifetime income with charitable donations, i.e., they combine annuity payments to the donor with a charitable contribution. These gifts are one of the most tax efficient ways of donating money to an institution. The grantor makes a contribution to the Trust and receives a tax deduction (based on a Treasury calculation regarding the amount to be left to charity).

The trust is usually funded with low basis assets because the sale of the stock within the Trust does not trigger capital gains taxes. The beneficiary of the trust receives an annuity. Taxes are paid by the beneficiary only when funds are withdrawn from the CRUT. Assets remaining after the life of the Trust go to charity. [Source: Ann Kaplan. 2010.”Philantropic Planning” Smith College, October 20, presentation]

CLAT (Charitable Lead Annuity Trusts)

CLAT combine wealth transfer to heirs with charitable giving and are another tax efficient way of donating money to an institution. They are comprised of the remainder of the estate after the heirs receive a specified amount and allow the donor to make a contribution to a trust and receive an immediate tax deduction.

An annual amount, established using the treasury rate in effect at the time the CLAT is established, would be paid to the institution. The difference between the charitable annuity payments and the investment results will transfer to heirs at the termination of the CLAT. During life of CLAT, annuity payments are distributed to charitable vehicles or institutions as scheduled when CLAT is established. (Source: Ann Kaplan. 2010, “Philanthropic Planning,” Smith College, October 20, presentation.)


Patricia Annino is a sought after speaker and nationally recognized authority on women and estate planning. She educates and empowers women to value themselves and their contributions in order to ACCOMPLISH GREAT THINGS in the world – and in so doing PROTECT THEMSELVES, those they love, and the organizations they care about. Annino recently released an updated version of her successful book, Women and Money: A Practical Guide to Estate Planning to include recent changes in the laws that govern how we protect our assets during and beyond our lifetime. To download Annino’s FREE eBook, Estate Planning 101 visit, http://www.patriciaannino.com.

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