CHARITABLE ASSETS
Your gift of cash to the Solano Community Foundation is the most expedient and direct method giving. Your contribution is 100% tax deductible at the time of gift. Your gift can go to support the operation of the Foundation to insure our capacity to continue to grow and serve the community, to an existing component fund already established at the Foundation, or to establish your own endowed or non-endowed fund.
There are other assets you can donate to the Foundation. Most charitable gifts qualify for maximum tax advantage under federal law.
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Making a charitable gift of real estate through the Solano Community Foundation can help you turn your property gains into community good. Gifts of real estate range from personal residences and vacation homes to rental properties, farmland, and commercially developed land — the value of which may exceed that of any other asset you own. With the help of the Solano Community Foundation, you can use real estate to make a bigger charitable difference than you thought possible, avoid estate taxes, and minimize or eliminate burden placed on your heirs.
You may choose to give real estate outright and receive an immediate tax deduction, or retain the use of the property during your lifetime and make a planned gift to the Solano Community Foundation. You may also choose to convert real estate into a stream of income for the rest of your life by establishing a Charitable Remainder Trust with the Solano Community Foundation. Doing this lets you transform a low-yield asset into a higher-yield, income-producing asset and claim a tax deduction for the charitable portion of the gift.
A gift of real estate must be professionally appraised to establish its fair market value. It is also assessed for compliance with our acceptance policies to make sure its resale will provide the appropriate value to community.
Example Donor Story: Real charitable value
Sandra and Cliff Stewart owned a summer home and had no heirs interested in inheriting it. At first, the Stewarts planned to sell the home and give the proceeds to charity. But after talking with their local community foundation, they realized that giving the home directly to the foundation would create the biggest, most effective gift, while providing the greatest benefits to them as donors. “It was a great option — we could give our house to charity through the foundation and start any type of fund, not to mention the tax benefits to us,” says Sandra. The Stewarts learned they could also retain use of the home for their lifetime. “This way,” Cliff explains, “we can spend our summers enjoying the home for the rest of our lives. And after our lifetime, the foundation will use the proceeds to make grants from the Sandra and Cliff Stewart Fund.”
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Life insurance provides a simple way for you to give a significant gift to charity and establish your legacy, with tax benefits that you can enjoy during your lifetime.
You can make a gift when life insurance is no longer needed for personal financial wealth replacement by either giving a paid-up policy or continuing to pay premiums. You may receive a number of tax benefits, including reduced estate and income taxes. And, if you choose to continue paying premiums through the Solano Community Foundation, you will be entitled to a charitable contribution deduction of up to 50 percent of your adjusted gross income.
You can replace the dollar value of an asset transferred to the Solano Community Foundation with a life insurance policy. Or, you can use regular payments from a Charitable Remainder Trust to establish an irrevocable life insurance trust. The trust can purchase insurance on your life to benefit your heirs. This way, you can make a gift to the Solano Community Foundation and replace the value of this gift within your estate with life insurance proceeds.
Example Donor Story: A gift that pays
When his two daughters were young, Zachary Tan bought a life insurance policy to provide for his family in the event of his death. Now, he’s 65, and things have changed. “My daughters are both grown and doing very well for themselves, and over the years, my wife and I have become fairly comfortable — she will no longer need the death benefit from my policy,” says Zachary. The Tans support and volunteer for a youth mentoring program, as well as their local museum. “We’ve always planned to leave something for important community organizations when we pass,” says Zachary. After talking with their financial planner, Zachary decided to give his life insurance policy to his local community foundation. “After giving my policy, I received a significant charitable tax deduction,” says Zachary. “We had owned the policy for so long that we could choose to stop paying the premiums and maintain a sizable death benefit.” The Tan Fund will be established with proceeds from the insurance policy to benefit youth development and other community organizations.
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Everybody wins when you make a gift of appreciated stock to the Solano Community Foundation. Your gains are put to good use. Your gift of stock is reinvested in your community, and it qualifies for an immediate tax deduction based on the full market value.
Giving appreciated stock through the Solano Community Foundation is popular among a range of givers — individual investors, families, entrepreneurs, and even groups of friends who have formed investment clubs.
By giving stock to the Solano Community Foundation, you can avoid capital gains taxes that would be due as a result of its sale, and establish a charitable fund that benefits the local causes and organizations you care about most. With gifts of appreciated stock, your stock market earnings translate into community impact, so you get a more rewarding return on your portfolio. You can set up a scholarship program; support special programs for at-risk youth, senior citizens, or other people in need; address environmental concerns; support the arts; or any other charitable cause dear to your heart.
Example Donor Story: Generating a return for your community
“Our stock returns provided the means for giving to our community,” say Joanne and Gerald Johnson. That’s why they joined the many people who choose to contribute appreciated stock to open a Non-endowed (Donor Advised) Fund. Last year, the Johnsons helped fund a local family outreach program, a homeless shelter, and a local theatre group. “Some of our charities are too small to accept direct stock gifts,” says Joanne. “Giving through our local community foundation eliminates that barrier.” The Johnsons receive a tax deduction on the full market value of their appreciated stock, while avoiding the capital gains tax that would otherwise arise from the sale of this stock. Gerald says, “It’s a simple, satisfying way to give.”
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LEARN MORE
There is so much more we’d like you to know. For more information and ideas on ways to integrate your financial planning with charitable giving, ask your financial advisor or contact Stephanie Wolf.