Planning Your Gift

Tax Strategies

Committee on Development Meeting

October 8, 2010

Several individuals, including trustees taking up the mantle of savvy charitable entrepreneurs, have begun conversations about planned gifts since the June meeting. For example, potential donors have expressed interest in charitable remainder trusts funded with appreciated securities and real estate, gifts that will accomplish charitable as well as personal planning objectives. As we have discussed at these meetings over the years, planned gifts can be structured to meet capital campaign goals – to build or care for buildings and add to scholarship endowment in support of Bicentennial Initiatives.

The powerful benefits of contributing appreciated securities and real estate held long term, outright and in trust, remain in effect. Charitable remainder trusts allow donors to lock-in the current value and diversify assets in a tax wise way

Please keep in mind the opportunities provided in June as you speak with others interested in Hamilton, for example completing a contribution in advance of merger and acquisition activity. In addition, several points require an update, since federal tax legislation has not been enacted into law:

• Gift taxes are lower this year than in 2009 and 2011. Generation Skipping Transfer Taxes are suspended (along with the estate tax) in 2010.
   
• Estate tax law remains in a state of flux in this year of transition and beyond. Advise friends to be sure their estate plans are up to date.
  • Consider asset transfer strategies, gifts to heirs, grantor retained trusts, and charitable lead trusts.
  • Charitable lead trusts make immediate payments to Hamilton for building or scholarship purposes, with the principal and appreciation delivered to heirs at reduced gift tax cost.
     
• Life-time contributions of IRAs for individuals 70 ½ years has yet to be extended to 2010.