January eRate: Increase in IRS Discount Rate Creates Opportunities

Rapid Ascent of IRS Discount Rate Creates Opportunities

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In February, the IRS discount rate was 1.6%. In December, it is up to 5.2%, more than triple what it was just ten months ago. This dramatic change coincides with a similar escalation of interest rates in the U.S., generally, as well as increased nervousness over whether the rapid rise in interest rates might soon tip the economy into a recession.

Don’t freak out over the swift shift in economic conditions. View it as an opportunity. This is a great time to renew contact with your donors and educate them about gift plans they might want to consider in this new economic reality.

WEBINAR January 26

Asking Your Donor for Their Largest Gift Ever: A Bequest

Did you know most people give a larger gift to their favorite charity through their estate than all their lifetime gifts to that charity combined? Many fundraisers fear a bequest conversation means talking about death, dying, and cutting the kids out of an inheritance. Who wants to do that? In this webinar, Anne Melvin, Senior Learning Consultant to Harvard University’s central fundraising operation, will help you reframe your understanding of the bequest ask, learn ways to talk about bequests, and arm you with the kind of knowledge that will help you make the bequest discussion a positive, life-affirming experience.

Presented by
Anne T. Melvin, J.D.

Thursday,
January 26, 2023
1:00 - 2:00 pm ET

UPCOMING TRAINING

PGM to PGM Anywhere FREE

January 5, Online (90 minutes)

PGM Anywhere and Gift Annuities

January 17-18, Online (4 hours over 2 days)

PGM Anywhere and Charitable Remainder Trusts

February 8-9, Online (4 hours over 2 days)

PGM Anywhere Introductory and Advanced

Introductory: February 14, New York, NY (in person, 9:00 am - 4:00 pm ET)
Advanced: February 15, New York, NY (in person, 9:00 am - 4:00 pm ET)

PGM Anywhere Quick Tip: Avoid Last Minute Year-End Payments

Despite everyone’s best efforts to close gifts earlier, there are often charitable gift annuities completed in the last two weeks of December. Normally, a prorated payment for the first partial period of these annuities would be due on December 31. But the way things work, it can be challenging to get a small payment issued for a brand new gift annuity in the waning days of December.

PGM Anywhere offers a simple and attractive alternative: the first prorated payment can be combined with the first regular payment in the new year. This can be accomplished with a couple of clicks in the Gift Options window. Once you have selected a Gift Annuity and indicated the payment frequency and timing, you should choose Yes to the question about prorating the first payment, and then choose Yes again to the question about combining the first partial payment with the first regular payment. PGM Anywhere then will automatically reflect the actual date of first payment – in a quarterly payment frequency, for example, the actual first date of payment would be March 31, 2023. EASY-PEASY!

PGMA combining prorated payements

Contact our Client Services team at 888-474-2252 or support@pgcalc.com if you need help.

***GiftWrap* Quick Tip: Year-End Update is Required in *GiftWrap***

GiftWrap data is maintained according to specific calendar years. Current-year payment information, as well as payment information for previous years, is generally available, but payment rows for future years are not yet created. This is because it’s impossible to predict which annuitants and beneficiaries will be alive in the coming years, and which ones will be deceased. As the current year draws to a close, a straightforward and necessary process is required in GiftWrap in order to review or process payments in a new calendar year. This process is also required in order to produce tax-reporting documents for the current year.

The function is called “Year End Update,” and it is found in the Actions menu. It’s very simple to run, but a word of caution: ideally, Year End Update should only be run after the Verify routine has been run and all errors have been resolved. With that in mind, the Year End Update function basically involves confirming that you are in a current year and that you want to update to the next calendar year. When this process is run, all payment rows for the new year will be created. In addition, it will now be possible to produce 1099-Rs for gift annuitants and K-1s for pooled income fund participants for the previous calendar year. Generally speaking, the Year End Update process takes only a minute or two, except for very large programs.

GiftWrap Year End Update

On a related note, PG Calc sent an email earlier today to our GiftWrap clients detailing the Year-End Operations and 1099-R Instructions. Contact our Client Services team at 888-474-2252 or support@pgcalc.com if we can help.

From the Blog: Is the Legacy IRA Act the Next Big Thing?

The “Legacy IRA Act” would allow a Qualified Charitable Distribution (QCD) from an IRA to fund a split interest gift (charitable gift annuity (CGA), charitable remainder unitrust (CRUT), or charitable remainder annuity trust (CRAT). At the time of this writing, this proposed change has been included in pending legislation that is, alas, stalled as the 117th Congress heads toward adjournment in December 2022. If the Legacy IRA Act provisions are not passed this year, there are plans to reintroduce the legislation when the new Congress convenes in January 2023.

What are the chances the Legacy IRA Act will become law? And, more importantly, what should you be telling prospective donors? Before we get to those key questions, let us review the proposed Legacy IRA Act and its journey through this Congress.

Read the blog post . . .

New ACGA Rates Coming Soon to PG Calc Software

The American Council on Gift Annuities (ACGA) announced on November 23 that it will be raising its suggested maximum annuity rates, effective January 1, 2023. The ACGA estimates that its new one-life and two-life rates will be about 0.6% higher than its current rates. The ACGA expects to make the new rates available to the general public on December 19. We plan to release updates of PGM Anywhere, PGM desktop, and GiftCalcs later the same day.

If your PGM Anywhere or GiftCalcs account is set up to use the current ACGA rates, they will automatically select the new ACGA rate for gifts made on or after January 1, 2023 and the current ACGA rates for gifts made from July 1, 2022 through December 31, 2022. PGM desktop will do the same once you have installed the PGM 7.6A update. We will post our analysis of the new rates on the PG Calc Blog on December 19. Sign up for the PG Calc Blog to be notified as soon as the analysis is posted.

The PGM Anywhere and PGM desktop updates will also include the federal tax tables for 2023. These tables are indexed annually for inflation.

Contact Client Services at 888-474-2252 or support@pgcalc.com if you have questions about either update.

Marketing Tip: What Kinds of Content Do Donors Want?

At PG Calc, when we create a planned giving newsletter, it always has a distinct theme focused around a donor story. This gift story, which is the most important asset, is paired with our relevant planned giving articles. Although we guide the process with best practices, our clients can have an active voice in every issue. From choosing educational articles on bequests and annuities, to stories on how to prepare for a meeting with your attorney to create an estate plan, the content varies greatly. Our main concern, editorially, is to make sure the newsletter is a “good read.” And the more topical and newsworthy a newsletter can be, the better.

Year-End Giving: Deciphering Gift Dates

It’s that time of year, when some donors frazzled by holiday planning leave their charitable giving to the last minute.

To help ensure that their end of year gifts count for 2022, we developed a primer on how to determine gift date. In it, we cover gifts of:

Cash (check and wire)
Stock
Mutual Funds
Credit Card
IRA QCD

Read our Knowledge Base article on Deciphering Gift Dates.

Use Your “Phone-a-Friend” This Year End: Client Services is Here For You!

We know our clients are at their busiest the last weeks of December trying to close every gift possible before the end of the year. We want you to know we are here for you! Client Services will be working and available during the last two weeks of December, save for December 26th (Christmas Day observed). Don't hesitate to call us if you need help with our software, or if you simply want to discuss a particular gift plan.

During the weeks of December 19 and December 26 we will available during our regular weekday support hours from 8:30 am – 6:00 pm ET, except for December 26th as noted above.

Contact Client Services at 888-474-2252 or support@pgcalc.com.

Registration for 2023 Webinars Opened on December 15

Registration for each of PG Calc’s monthly webinars in 2023 is now open! We have arranged a great line-up of in-house and outside experts to discuss fundraising metrics, talking to donors about bequests, marketing planned gifts, and nine other topics important to gift planners. We hope you’ll join us for some or all of them!

Eight of the webinars will provide a 45-minute formal presentation followed by a 15-minute Q&A period. They will cost just $45 for the first registration and $25 for each additional registration. The other four will be free “Q&A webinars” that will be your chance to ask an expert your questions on the designated topic. All registrants will receive a replay of the webinar that is good for 60 days.

How to register: You can find the date, presenter(s), and description of each webinar on the PG Calc website. To register for a webinar, scroll down to the webinar you’re interested in, click the webinar title, then click the Register Now button. To register for the whole series - just $270! – click any webinar that doesn’t have “Q&A Webinar (FREE)” in the title, click Register Now, and select one of the “2023 Series” purchase options.

The Wilderness Society Finds **PG Calc’s Support of GiftWrap “Indispensable”**

“PG Calc may be the industry standard for gift illustrations and administration, but it is the customer service that enables you and your program to thrive. We’ve faced small adjustments and big updates alike to our GiftWrap suite and are grateful for the fantastic support of PG Calc staff, such as Ellen Rakatansky. Whether addressing a technical issue or helping us expand ways to make better use of GiftWrap, Ellen and the PG Calc team have been an indispensable partner in our success.”

—Sean R. Twomey
Director of Planned Giving
The Wilderness Society

Learn more about The Wilderness Society.

Learn more about our GiftWrap software.

PG Calc 129 Mount Auburn Street Cambridge MA United States

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