Larry K. Fox, CFP®, CLU®, ChFC®

Larry K. Fox and Associates Ameriprise Financial, Inc.

Planned Giving Provides All-around Benefits

May 25, 2010 --A little planning can make charitable donations go a long way. Planned giving, usually arranged with the benefit of financial and legal experts, refers to strategies that can help you maximize your giving in a way that can be financially beneficial to everyone involved — including you,
the donor.

When you think through and compare various options for charitable contributions, it’s easy to see how planning can lead to more profitable giving.

If you have large stock holdings and want to continue to benefit from your investments — but also want to share your wealth with your favorite charity — there are a number of ways to go.

You can simply send the charity of your choice a check once a year and take the deduction on your taxes (subject to AGI limitations). You can also make provisions in your will to leave a portion of your assets to the charity.

There are other options available that a financial and legal advisor can help you explore that may allow you to give more to your favorite charity while you are still living.

For example, by placing your assets in a charitable remainder trust, you receive income for the remaining years of your life or for a specified length of time of 20 years or less. If you select a charitable remainder unitrust, the amount you receive will adjust to reflect changes in your trust asset balance.

As an irrevocable gift (meaning it cannot be changed), you can claim an immediate charitable income tax deduction for the value of the charity’s remainder interest (again, subject to AGI limitations). Any amount exceeding the AGI limitation can be carried forward up to five years.

Because the trust is essentially removed from the estate, it may reduce estate taxes.

This form of giving also provides the added benefit of enabling you to enjoy the personal satisfaction of giving while you’re alive. And, the charity benefits by being the recipient of whatever remains in the trust at the end of the term.

Talk to your financial advisor to discuss how your giving goals fit within your overall financial plan and explore strategies for planned giving. With proper advice, it’s easier to be a good steward of your resources as you support organizations you value.

Financial planning services and investments offered through Ameriprise Financial Services, Inc. Member FINRA & SIPC.

This information is not intended as legal or tax advice. Please consult with your legal and tax advisors regarding your individual situation.