Bequests may be made by will or through revocable living
trusts by making a charity a beneficiary of the trust.
The vast majority of planned gifts are in the form of
Revocable and Irrevocable Living Trusts
Usually benefit the charity with a remainder interest.
These are the most preferred types of gifts because
a charity can invest the proceeds immediately. Outright
gifts may take the form of cash, negotiable securities,
and gifts of tangible and real property.
Charitable Remainder Trusts
A charitable remainder trust allows a donor to give
property or cash which will be used by a third party
(the trustee) to earn income which is paid to income
beneficiaries (usually the donor) for life, a period
of years, or a combination of the two. At the end of
the payment period, the trust principal is given to
the charitable remaindermen, the charity or charities
named in the trust document. Two forms of charitable
remainder trusts are used:
a. The unitrust provides an income based on a percentage
of the trust principal which is chosen by the donor
at the outset. Donors can add gifts to existing unitrusts.
b. The annuity trust provides a fixed income (a percentage
of the trust amount) which is chosen by the donor at
the outset. The payments don’t change and will
come from trust principal should earned income not be
sufficient. Donors may not add gifts to existing annuity
trusts since it would not increase their income.
Pooled Income Fund
This is an investment fund similar to a mutual fund
made up of assets irrevocably contributed by many donors.
Contributions are commingled for investment purposes.
The net income is paid to the donor in proportion to
the number of units allocated to each donor. When the
income interests of all of the beneficiaries of a gift
from a donor end, the principal of the fund attributed
to that gift (the remainder interest) goes to the charity.
Charitable Lead Trusts
The trustee of a charitable lead trust (also known
as a charitable income trust) pays the income of the
trust to a charity or charities. At the end of a fixed
period of time, the trust principal is transferred to
one or more non-charitable beneficiaries.
Retained Life Interests in Gifts of Real Property
This arrangement allows a donor to make a gift of the
remainder interest (that which is left after the donor’s
lifetime) in a personal residence or farm to charity
and reserve to the donor a life estate (the privilege
to live in the home for life). These gifts are contracts
and the donor agrees to pay all property tax due, maintain
the residence and provide adequate insurance. Some charities
take remainder interest gifts in exchange for a gift
A donor may give a paid up life insurance policy to
charity, naming it both owner and irrevocable beneficiary
or a policy that is not paid up if it has a current
value. You may terminate the policy for current value
or keep it in force if the donor continues to make gifts
that equal the cost of premiums for that policy.
IRAs and Retirement Plans
ACS can be named a beneficiary of IRA’s, Keogh
plans, or other qualified retirement plans. These assets,
if left to heirs, would be subject not only to immediate
estate tax, but also to income tax when distributed.
Charitable Gift Annuity
The gift annuity is a contract between a charity and
donor which provides for a gift from the donor and annuity
payments from the charity. Payments may be annual, semi-annual,
quarterly or monthly. The gift annuity process is highly
regulated by the State Insurance Commissioner who issues
licenses and can require substantial reserves for each
The Planned Giving Committee
David Sacarelos, Chair - Partner and CPA, Seiler and Company
Mark Shepherd - Attorney and Partner, Crist, Biorn, Schultz and Shepherd
Nancy Hay -
Evan Lurie - Financial Services Professional, Mass Mutual Financial Group
Aarika Riddle - Development and Marketing Director,
Adolescent Counseling Services
The Planned Giving Advisory Committee
Alan Loveless - Realtor, Coldwell Banker
Sylvie Way - Retired CPA and Community Volunteer
Nancy Weeks Rossen - Community Volunteer
Curt Weil - Financial Advisor and President, Laseck Weil Wealth Advisory Group, LLC
For more information, please contact:
Development and Marketing Director
Adolescent Counseling Services
4000 Middlefield Road, Suite FH
Palo Alto, CA 94303
650.424.0852 x 103