PG Calc Featured Articles

Using a CRT or CGA to Stretch Payments From a Retirement Plan

In this article, Bill Laskin, PG Calc's Vice President of Product Management, explores the tax implications of the SECURE Act for IRAs and how that could impact gift planning.

IRS statistics indicate traditional IRAs held nearly $8 trillion in assets at the end of 2018, the latest year for which data is available. That is a huge potential source of charitable gifts. Any change that might increase the likelihood of gifts of IRA assets is enough to get gift planners excited, and rightly so.

The SECURE Act that was signed into law at the end of 2019 contained several provisions that drew the attention of gift planners. One provision of the Act was elimination of the so-called “stretch” IRA for most non-spouses. 

The SECURE Act significantly limited who can stretch payments from an inherited IRA over their life expectancy. Gift planners recognized that for charitably minded IRA owners, the elimination of the “stretch” IRA created an additional incentive to designate what is left in their IRA to one or more charities and use other funds to benefit their heirs.

2020: It Was the Best – and Worst – of Times

As Charles Dickens wrote in his A Tale of Two Cities: “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness.” Those words were written in 1859, but they could have been written yesterday.

How do we even begin to describe the year that was 2020? It was a year of so many extremes – a once-in-a-century pandemic, the most widely contested elections in U.S. history, unprecedented economic collapse, historic unemployment, tsunamis of misinformation and disinformation, and truly unimaginable levels of mistrust, suffering, and despair in the souls of people everywhere.

Change Is Here

As of the writing of this article, the inauguration of Joseph R. Biden, Jr. as the 46th President of the United States is just days away. Although past changes in the balance of political power have had little impact on overall charitable giving, we know that when donors experience uncertainty they tend to postpone and delay their giving decisions. This is a natural reaction: charitable giving is optional and, faced with uncertainty, the rational choice is to slow down or defer giving until the future becomes clearer.

Changes in tax law can create new and different gift opportunities. Gift planners will need to watch carefully and be prepared to react strategically to changing circumstances. What concerns might surface among donors? Could potential changes affect donors’ gift plans? How might we anticipate and address them? In this article we begin with a review of some concerns that are likely to be on donors’ minds with respect to charitable giving followed by a discussion of some of the essential processes by which Washington works.

 

Tax Implications of the Next President

PG Calc speculates and offers commentary about impending changes to Federal tax policy and the possible impacts on charitable giving. However, written on the eve of America’s transition to the Biden/Harris administration and the beginning of the 117th Congress, there’s a good chance that parts of it will pass into the category of "things we know for sure that just ain't so."

COVID-Era Success Stories in Planned Giving

The global pandemic created by the spread of COVID-19 has impacted millions of lives, disrupted the operations of charities and organizations, and upended planned giving fundraising as we know it. Yet from this global crisis, we have witnessed several remarkable planned giving success stories from our clients. Following are four of these successes that we hope will prove educational and inspirational.

The NSGPS from CGP has Something for Everyone

Unveiled at the CGP 2020 Conference this month, The National Standards for Gift Planning Success ("NSGPS" or "Standards") are designed to help you engineer a successful planned giving program. Much more than a just simple list of best practices, the NSGPS is a comprehensive toolkit to help identify and overcome challenges that may be hindering your gift planning efforts. The Standards are not prescriptive and are scalable to the size and maturity of your program, allowing you to adapt and address current needs while building on your strengths.

Taking a Closer Look at QCDs

Qualified charitable distributions (QCDs), also known as charitable IRA rollovers, are particularly appealing to donors because they provide a tax benefit whether or not the donor itemizes deductions. While on the surface they seem simple – request a payment go directly from the plan administrator to a qualifying charity – there are nuances to these types of gifts of which charities should be aware. Let’s take a closer look at some of those subtleties as they relate to QCD requirements.

Projecting the Value of your Bequest Pipeline

Planned giving departments need to demonstrate accountability for results in terms of gift revenue. Our challenge, of course, is that we generally don’t know how much planned gift revenue is coming or when it will come in, making it very difficult to accurately measure the results of current efforts. Let’s look at how using a combination of historical realized planned gifts and current calculations can generate a reasonable picture of the value of your planned gift pipeline.

10 IRS Rules You Need to Know to Help Your Donors Make Great Gifts

Life is full of rules, and planned giving is certainly no exception. When we talk about IRS rules and planned giving, we mean not only specific sections of the federal tax code, but also IRS rulings, conditions, limitations, and the like. In putting together our webinar for August 27, which will highlight 10 rules that gift planners should know, we thought it might be helpful to provide a brief preview in this format.

Taking Advantage of the 100% Limit on Deductions for Gifts of Cash in 2020

The Coronavirus Aid, Relief, and Economic Security Act, better known as the CARES Act, became law in late March. The Act includes several provisions of interest to gift planners. Arguably the most significant of these is the ability to waive the usual 60%-of-adjusted-gross-income limit on deductions for gifts of cash made to public charities in 2020. This change creates several gift opportunities that will appeal to some donors.