Women & Money: Charitable Giving Tax

Charitable giving

estate planningDo you want to participate in involuntary philanthropy – that is, pay estate taxes and let the government decide what to do with your donations? Or would you rather play an active role yourself in where that money goes? Making a gift to a charitable organization will enable you to help those causes you deem worthy, while at the same time reducing your taxable estate. (See Women & Money, Chapter 14: Protect Your Charity” for information on how to make a charitable gift that qualifies for estate tax deduction).

Gifts to Individuals and Income Tax Issues

You are not entitled to an income tax deduc­tion for a gift to a person, and, in the same way, your gift is not considered “income” to the person you give it to.

When giving property rather than cash, however, each asset has what is known as an “income tax basis” – that is what the asset originally cost (plus, if the asset is real estate, any improvements that have been made to it). When an asset is sold, the owner of the asset will pay a capital gains tax based on the difference between the original cost of the asset and the current sale price.

If an asset is given to someone during the donor’s lifetime, then the recipient of the gift inherits the donor’s income tax basis in the property, and when the recipient sells that property, his gain would be the same as the original owner’s. In other words, if this year your mother gave you $20,000 in stock in Gillette that she had owned for a long time, your mother would not pay any gift taxes on the transfer of stock and you would not be responsible for paying any income taxes. However when, at a later point, you sell that stock, you will incur a capital gain that is equal to the difference between the price your mother bought it for, if she paid for it, or the value of the stock when she received it by inheri­tance or, if she received it by gift, then the income tax basis that was handed over to her and the price you have sold it for.

The rules are different when the gift is made at death. If, instead of gifting you the stock during her lifetime your mother had left it to you in her Will at her death, then the $20,000 would be included in her taxable estate (even if there is no tax then due). When that happens the income tax basis in the stock steps up to the fair market value at the time of your mother’s death. When you later sell that stock, any gain will be based on the differ­ence between its value at the time of your mother’s death and the price you get for it.

In most cases this will significantly reduce the gain. For that reason, many people take care to select for gift-giving during their lives property with lower capital gain and save the property with the greatest capital gain for gifts upon their deaths. That is also why, for fed­eral estate tax purposes gifting is not always tax-wise if the federal estate is under or close to the federal applicable exclusion amount (which at least for 2011 and 2012 is $5,000,000 per person).

 

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.

Women and Money – Patricia Annino on Family Business

Women have control of more personal wealth than ever before, yet many women do not take the steps necessary to protect that wealth for themselves and their families. Attorney and author Patricia Annino discusses the biggest planning challenges facing women today, and the most important steps a woman can take to plan for her financial future. Ms. Annino is interviewed by Donald Levitt, Ph.D.

Source: FamilyBusinessWiki.org http://familybusinesswiki.ning.com/video/women-and-money-patricia-annino-on-family-business-wiki-s-4

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.

A Candid Interview with Patricia Annino!

Patricia was recently interviewed to get her insights on women, money, and philanthropy  Here are some of Patricia’s responses.  We hope you find them helpful when considering the way you look at, manage, and gift your money.

What does money mean to me? Freedom, control, independence

What does money help me to do? Make my own choices about the way I live my life- how hard I work, what I choosework-life scale image to do with my time and what I choose to give money to.

Is money a means to an end or and end in itself? A means to an end- money is a medium- it can be used in whatever way the person who has it decides- by itself it is neutral. You can use to buy items, support a lifestyle, invest in businesses or assets and give to philanthropy you choose- what you do with money is under your power and control. It is part of the journey – not a destination

How do you think about money in connection with philanthropy?

Time, treasure and talent are all important when it comes to philanthropy. They are three legs to the stool.

The treasure, or money component is one that is typically based on the way that you have grown up with philanthropy – if you go to church every Sunday and always put a few dollars in the collection plate that started the way you think about money and philanthropy.

As life goes on in most families there is not a strategic discussion about philanthropy- it is part of the community effort or business effort of the family- and frequently an essential part of “giving back” but not an independent thought- for most families around the dinner table what to do with the treasure component of philanthropy is not a core discussion

Most of us learn the way that we view money –what is good to spend money on, what not to spend money on and how much to spend at that kitchen table. As we grow older we need to understand why we have money habits – vacations are okay, going out to dinner is not okay, going out to dinner once a week is okay, giving money to the church each Sunday is expected, giving beyond that is not etc and step back from those habits and think about why your spending patterns including your philanthropy spending pattern exists and independently evaluate it.

To me thinking about money and philanthropy is an evolutionary process- first you have to step back from your habits and then think about the extent you wish to be philanthropic with your time treasure and talent and then design a plan – as life goes on (and you understand and think about life as a movie not a snapshot) your philanthropy program should change and evolve as you do.

How often does the word “money” come into conversation when you talk with other women about philanthropy?  Because of what I do for a living – fairly frequently and because I am in my 50s fairly frequently –when I look back to earlier times of my life it was not a topic that was frequently used with my friends and that is because there were other “more pressing” topics of conversation- children, building career, husbands, relationships. As you mature and life evens out I have found that there is the mental space to think about the connection to the bigger pictures in life, what matters and broader contributions.


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.

Patricia Annino to Speak at Online Conference by Women’s Philanthropy Institute

Patricia Annino is one of the She Makes Change Speakers participating in the Online Conference presented by the Women’s Philanthropy Institute at the Center on Philanthropy at Indiana University.  We hope you are able to join Patricia and the other speakers participating in this 3-day event.

To register visit:  http://www.philanthropy.iupui.edu/courses-and-seminars/course/she-makes-change

If you have questions contact:  wpiinfo@iupui.edu

Here are the basics:

Join us for a dynamic, engaging & inspiring three-part online conference starting in September.

This high-level learning experience explores the connection between women, money, and philanthropy. Through live presentations, panel discussions and research, industry leaders and philanthropists explore how women view money, uproot perceived attitudes about money and philanthropy, and leverage these insights to change the world.

September 20

3:30-4:40EST

What Women Really Think about Money

You may be surprised. Listen and join the conversation to discuss attitudes toward money, the connection between materials and spiritual perspectives, and the implications for philanthropy.

September 27

3:30-4:40EST

Unraveling the Myths

From uncertainty to insight: join us to explore how societal attitudes, misperceptions, and gender affect philanthropic behavior.

October 4

3:30-4:40EST

Change Your Strategy and Change the World

Philanthropy is about more than money. Learn how being proactive and intentional leads to deeper awareness and fulfillment in philanthropy. Listen as women who have made a difference discuss steps you can adopt to more effectively manage your finances and philanthropy.

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.

 

 

 

 

 

Patricia Annino Receives “Best in Wealth Management” Award

The Euromoney Legal Media Group chose Patricia Annino, Chair of Prince Lobel’s Estate Planning and Probate Practice Group, to receive the prestigious “Best in Wealth Management” award at the second annual Americas Women in Business Law Award ceremony held May 24, 2012, in New York City.

Selected from a short-list of eight well-known, highly-qualified nominees, Patricia’s award was based on extensive peer review research conducted by Euromoney’s research team, her professional accomplishments during the past 12 months, and her advocacy and influence in the field of wealth management.

Following the success of similar award ceremonies in Europe and Asia, the Americas Women in Business Law Awards was launched by Euromoney Legal Media Group to give law firms and professional services firms the recognition they deserve for their efforts in helping women advance in the legal profession.

Patricia Annino is a nationally recognized expert on estate planning and taxation, with more than 25 years of experience serving the estate planning needs of families, individuals, and owners of closely held and family businesses. She speaks regularly on many issues of concern to family owned businesses, including succession planning, risk management, managing a business with multiple stakeholders, the risk of divorce, and more. Annino is a graduate of Smith College and Suffolk University School of Law.

Patricia is the author of two widely utilized professional texts: Estate Planning in Massachusetts, and Taxwise Planning for Aging, Ill, or Incapacitated Clients. Patricia’s recent books for consumers include, Cracking the $$ Code: What Successful Men Know and You Don’t (Yet), Women in Family Business: What Keeps You up at Night, and Women & Money, A Practical Guide to Estate Planning.

About Prince Lobel

Prince Lobel Tye LLP is a full-service law firm providing a wide range of services for Fortune 1000 companies, closely held businesses, and individuals. Prince Lobel’s attorneys are guided by the highest standards of legal excellence, professionalism, and service – whether they are addressing complex business issues or providing advice on personal legal matters. Practice areas and industries served encompass corporate law, data privacy and security, domestic relations, employment law, estate planning and probate, insurance and reinsurance, intellectual property and Internet law, litigation, media law, nanotechnology, real estate, telecommunications law, construction law, environmental law, renewable energy, health care, and education. For more information, visit Prince Lobel at PrinceLobel.com.

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.

Women In Family Business – The Importance of Clarity

By Patricia Annino, J.D., Thomas Davidow, Ed.D. & Cynthia Adams Harrison, Ed.D., LICSW

The Importance of Clarity

The more you and your husband agree to treat the business as a performance arena in which preparation is everything, the more productive your child will be. Similarly, the clearer you can be in terms of creating structures, the better off your child will be when he does enter the business. Being proactive about creating routines through governance structures or through accurate job descriptions is very helpful. If your child is already working in the business, you and your husband can discuss how to create sensible structures with appropriate boundaries. Everyone performs better when they know what’s expected and what the rules are.

Be Informed-Be Influential – Points to Remember

  • If your husband resists talking to you about the business or is upset about something at work and won’t share why, don’t take it personally and don’t give up.
  • Men and women really are different in how they think, behave, feel good about themselves and communicate.
  • When you set a limit for your husband, you are actually encouraging him: You are telling him that he is capable of achieving his goals as a businessman, husband and father.
  • It is possible to find the balance between creating objective criteria for your child’s performance in the business and maintaining family harmony.
  • There’s a difference between granting your child the automatic right to work in the business and giving him the opportunity to do so.
  • Things go best when there is consistent communication between you and your husband and between both of you and your child.

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.

 

Donor Education & Financial Literacy

Educating the Donor about Tax Savings and Efficiency Matters

A significant advantage of financial literacy is that it can save the donor in estate tax depending on the type of gift made to institutions. It is important for donors to realize that inaction is involuntary philanthropy.  That is, what donors pay in taxes to the federal and state governments is spent by the government as it wishes on programs of its choosing.

So when donors pay taxes or give money without exercising any specific influence, they have engaged in de facto involuntary philanthropy.  That involuntary philanthropy can be at least partially converted to voluntary philanthropy by donating part of what the government would otherwise receive to charities of the donor’s choosing for purposes of the donor’s choosing.

Once donors realize that they have engaged in involuntary philanthropy, they are often motivated to consider philanthropic gifting. In other words, when the donor makes a private charitable gift and receives an income tax deduction for that gift, then the government loses part of its share of revenue and those funds are instead redirected to the specific philanthropic causes of the donor’s choosing.

Careful planning is needed to minimize transfer taxes, and charitable giving can play an important role in an estate plan. (http://www.360financialliteracy.org/Topics/Budgeting-Spending/Budgeting-and-Saving/Charitable-giving?print=1). By leaving money to charity, a donor may deduct the full amount of a charitable gift from the value of a gift or taxable estate. Understanding that there may be tax benefits and exploring what those benefits may be can be an effective way to start the giving conversation.

In particular the effective use of specific bequests to institutions, charitable lead trusts and charitable remainder trusts result in the donor and his/her family paying less in estate taxes. In 2011, generally, the federal gift and estate tax is imposed on transfers in excess of $5 million and at a top rate of 35 percent. (http://www.360financialliteracy.org/Topics/Budgeting-Spending/Budgeting-and-Saving/Charitable-giving?print=1).

Making an institution the beneficiary of a tax deferred retirement plan is the most tax efficient way to leave money if assets are greater than the federal estate tax exemption, as the charitable institution will receive the funds free of both estate and income tax. (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.

Donor Education – Why Effective Donor Education Programs Are Important

One of the most effective ways to educate donors and help them achieve financial literacy is through sustained and focused donor education programs. The process of understanding the power of philanthropy and how it works best for a donor’s goals and objectives takes time. When donors learn together, share their ideas and understand what other donors have done and are doing, they become more comfortable with the process.

Donor education programs which focus on philanthropy and related topics, such as financial issues for women, can teach both men and women how to achieve the joy of giving while living. Your institution can incorporate into the donor education event faculty and student presentations which integrate messages into the mission of your institution. These programs can help differentiate/distinguish your institution and create deeper relationships with donors, alumnae, and alumni spouse (Women’s Philanthropy Institute 2009, 15). (8)

Effective donor education, combined with financial literacy, can also provide networking opportunities. Associating with women of similar financial standing increases their willingness to use their money to leave a legacy. This is especially relevant for women who are learning to be comfortable with their wealth. Many baby boomer women in this country will inherit twice—once from their parents and once from their spouse.  Nevertheless, donors will not give until they know that they can take care of themselves first. As an estate planning attorney, the most common question I hear from a new widow is, “Do I have enough money to live on?” (Of course that question should be asked many years before that moment in time.) Taking the time to systematically educate your women donors, to help them achieve financial literacy, to teach them that by gifting they can reap both current and future rewards will help empower them to act when they receive their “double inheritance.”

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.

Women In Family Business-The Importance of Clarity

By Patricia Annino, J.D., Thomas Davidow, Ed.D. & Cynthia Adams Harrison, Ed.D., LICSW

The Importance of Clarity

The more you and your husband agree to treat the business as a performance arena in which preparation is everything, the more productive your child will be. Similarly, the clearer you can be in terms of creating structures, the better off your child will be when he does enter the business. Being proactive about creating routines through governance structures or through accurate job descriptions is very helpful. If your child is already working in the business, you and your husband can discuss how to create sensible structures with appropriate boundaries. Everyone performs better when they know what’s expected and what the rules are.

Be Informed-Be Influential – Points to Remember

  • If your husband resists talking to you about the business or is upset about something at work and won’t share why, don’t take it personally and don’t give up.
  • Men and women really are different in how they think, behave, feel good about themselves and communicate.
  • When you set a limit for your husband, you are actually encouraging him: You are telling him that he is capable of achieving his goals as a businessman, husband and father.
  • It is possible to find the balance between creating objective criteria for your child’s performance in the business and maintaining family harmony.
  • There’s a difference between granting your child the automatic right to work in the business and giving him the opportunity to do so.
  • Things go best when there is consistent communication between you and your husband and between both of you and your child.

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.

Women in Family Business – The Importance of Clarity!

By Patricia Annino, J.D., Thomas Davidow, Ed.D. & Cynthia Adams Harrison, Ed.D., LICSW

The Importance of Clarity

The more you and your husband agree to treat the business as a performance arena in which preparation is everything, the more productive your child will be. Similarly, the clearer you can be in terms of creating structures, the better off your child will be when he does enter the business. Being proactive about creating routines through governance structures or through accurate job descriptions is very helpful. If your child is already working in the business, you and your husband can discuss how to create sensible structures with appropriate boundaries. Everyone performs better when they know what’s expected and what the rules are.

Be Informed-Be Influential – Points to Remember

  • If your husband resists talking to you about the business or is upset about something at work and won’t share why, don’t take it personally and don’t give up.
  • Men and women really are different in how they think, behave, feel good about themselves and communicate.
  • When you set a limit for your husband, you are actually encouraging him: You are telling him that he is capable of achieving his goals as a businessman, husband and father.
  • It is possible to find the balance between creating objective criteria for your child’s performance in the business and maintaining family harmony.
  • There’s a difference between granting your child the automatic right to work in the business and giving him the opportunity to do so.
  • Things go best when there is consistent communication between you and your husband and between both of you and your child.

 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 announced the release of 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.  Annino’s book is an exhortation, resource and trusted companion for women in all facets of life.  To purchase the book visit:  http://amzn.to/hOHuEV or for more about Annino, visit: www.patriciaannino.com

 

 

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